Government to offer conservatorship to AIG

Scary? No... A nightmare would seem moar akin, relevant, and properly descriptive.

Yes, that is better!

What I don't understand is how these bailouts will work out. AIG couldn't find anyone to help them out because they are a failed business. Why does the government think 85 billion will turn them into a successful company? They are just taking the fallout from the greed of bankers and speculators and passing it on to us. I personally don't care if my tax money goes into saving these greedy few, I have to pay taxes anyways but I think we are headed into dangerous territory. My real fear is hyperinflation and all these bailouts do is add to the problem. There is a reason the US stopped releasing the M3 and I won't go into the crooked way our government calculates the CPI.

I love ATS. I get to watch people call for the own demise along with everyone elses. They go "let the system crash" like they dont realize that they are the ones that will go down the hardest.

Maybe you don't want to fight for your future, but I'd like to fight for mine. You all want to let those businesses that made the mistakes "fail and get what they had coming to them". Unfortunately, you go down with them. Free market is great if you don't have any issue with letting many people die for some rich mans mistakes.

Make no mistake, you all will be the ones that pay for their mistakes, not them. They declare bankruptcy and move onto another business, maybe even another country. Meanwhile, you find the price of food just tripled, gas doubled, and you lost your job.

I wish you all good luck in the coming times, you obviously have no idea how significantly your life will change should the system truly crash like some of you are calling for.

Privatize the profits and socialize the losses.

Welcome to the new free market!

What's needed is some pretty big regulatory reform - the US government is just plugging up holes as they sprout out from the subprime mess.

Don't sugarcoat these companies. If they're essential for national/world economic harmony, why did they make such shady dealings in the first place? Whatever happened to corporate responsibility?

And what if America was in the middle of a war (a real one, although Iraq is bleeding money), famine, or something else requiring a huge amount of cash, these conglomerates would go down anyway.

I still like how public healthcare is looked at as creeping communism, but now, AIG, yet another bloated corpse of greed, has been revived through nationalization.

This problem won't be fixed until there's an overhaul of the system, but until then, it's going to be American tax payer money that's going to make up for these greedy swine.

[edit on 16-9-2008 by mattguy404]

reply to post by mattguy404


Its not about corporate responsibility. Its not like you steal money from your job so we are going to hold you responsible. This company sinks, alot of people go down with it. They sink and all these banks lose their insurance. Lot of companys will take HUGE hits if this company tanks.

How many families will be left jobless, how many companys will go over. How far will the stocks fall, savings lost, and consumer product prices soar? We don't know, and trust me, we don't want to.

This isn't about AIG, this is about everyone else it WILL destroy as a result. Free Market, like communism, only works on paper. It never takes into account human beings. People exploit every system.

You know how fast monopolies would form and rape every aspect of your life if we truly ran a "free market"? I wish people would read some books before they start talking about economics. Everyone is being so nearsighted about this. Its like they are looking at their feet as they run, just looking where the next step goes, not realizing they are running right off a cliff.

reply to post by mattguy404

Privatize the profits and socialize the losses.

Welcome to the new free market!

Wow! That summed up my feelings nicely.

Doesn't this mean that, if I carried AIG Insurance and paid my premiums....I'm paying for them twice? Once by AIG Billing and once in the taxes I pay that the FED is loaning them?

I don't have AIG Insurance, but, I should get some free insurance for floating them the loan, right?

Cuhail

reply to post by grimreaper797


I agree, there's no way to have a completely free, anarchic economy without any regulations, or have a completely command-control economy without any competition.


It's true that many people from firms such a Lehman Brothers will loose their jobs, but the CEOs will still get $100 million golden handshakes.

reply to post by mattguy404


And what does that tell you? That just because the company goes bankrupt doesnt mean they "suffer for their mistakes". Watching a huge company go bankrupt means YOU suffer for their mistakes.

Something to remember when a company is looking to tank.

Grim,

I do agree that it would be catastrophic for us all if our financial system collapses but I think it is something that we must prepare for. I honestly think that they are just delaying the inevitable with these bailouts and when that time does come it will be much worse because of them. The real problem isn't letting these companies go under it is the backlash that would come from foreign investors and central banks that our country relies on by being the world's biggest debtor nation that could leave our currency worthless. What happens when the losses from Fannie and Freddie continue? Do those losses just add on to national debt while the Fed prints new money to cover them further devaluing our dollar? Will some much money be spent on saving these companies to prevent economic collapse that the dollar becomes so weak that these investors flee in mass thereby causing it? I don't know the answers to these questions and I really do hope the Fed saves the day, heck I don't want to use my horde of silver to bribe the border agents.

In the 30's we had the Great Depression, the stock market did crash, people had their gold confiscated by the government (to bail out the government), there was a run on the banks and there was no such thing as FDIC so these Americans were dealt a crushing blow.

They were hungry, out of work, and poor. But those hard working americans pulled themselves up and survived.

The government had 60 years to learn from their mistakes so that it would never happen to us again. 60 years to figure out a way to make sure we had a safe place to put our money (bank), 60 years to regulate a stock market, 60 years to make a smarter and stronger America. And last to show that Depression generation that it had indeed learned from the mistakes and their hardwork and sacrafice was not for naught.

So now our jobs our overseas, we've racked up the biggest deficit in history, and foreign countries own more of our country than we do.

There is great fear of a run on the banks and the FDIC can't possibly cover it (they only had 60 years to figure it out)

So let's definitely keep bailing out these companies and don't worry about the little people. I did not major in economics however I, like so many others, have watched our paychecks stretched to the breaking point with food prices, gas prices, health insurance prices, etc. and while trying to keep a roof over the heads of my children and food on the table it just makes me a bit disgruntled to hand more taxpayer dollars to a corporation whose ethics helped put me in that position. So maybe it's not economics...my grandmother called it common sense.

Originally posted by Cuhail

reply to post by mattguy404

 

Privatize the profits and socialize the losses.

Welcome to the new free market!

Wow! That summed up my feelings nicely.

Let's make it even more simple.... T-H-E-F-T.

just to put this in a bit more perspective.

Our government provided 16.7 billion dollars over the period of 1 year to help victims of Katrina...

www.dhs.gov...

but we managed to loan AIG 85 Billion (+ the 20 Billion they borrowed over the weekend) in 24 hours.

I imagine that this will definitely heat things up:

www.spiegel.de...

Officials with the International Monetary Fund (IMF) have informed Bernanke about a plan that would have been unheard-of in the past: a general examination of the US financial system. The IMF's board of directors has ruled that a so-called Financial Sector Assessment Program (FSAP) is to be carried out in the United States. It is nothing less than an X-ray of the entire US financial system.

I don't think this will shock anyone:

For seven years, US President George W. Bush refused to allow the IMF to conduct its assessment. Even now, he has only given the IMF board his consent under one important condition. The review can begin in Bush's last year in office, but it may not be completed until he has left the White House.

Originally posted by angelonmyshoulder

The review can begin in Bush's last year in office, but it may only be completed if he leaves the White House.

fixed

i'm sorry i really couldn't resist...something to think about at least

i mean the last 8 years have been filled with so many things we never thought would or could happen, nothing is out of the realm of considering anymore imo

reply to post by grimreaper797


You forget that this actually refers to trust. Whom do you trust? Do you really trust a government that actually facilitated this? That helped bring this about? I'm confused, what part of the construction of the federal reserve was designed to benefit the public if they simply take more from us? How do these Fannie and Freddies' actually protect us from a depression if they have already failed and how can they just print more money without devaluing the currency? Seems far fetched to hope that bailouts for people that got in over their heads make much sense if one were going to base the system on a trust that now APPEARS nonexistent.

Why should we pay twice in the form of taxes to state, then the state makes lousy investments with CAFR goes over budget raises taxes again and then the federal reserve effectively charges us the taxpayers again for the pleasure of bailing out the businesses that stole the money from the the states and various entities in the first place? It just simply makes no sense to pay multiple times just to keep the lie going, America needs to grow up and stop expecting something for nothing.

There should be a major investigation of these events before we find ourselves in some kind of horrible war that will make Iraq look like a joke.

I hope we can overcome our sense of limitation that allows us to accept the truly unacceptable.

We need 4 simple things.

Back from Iraq and many other bases in the "Empire" that has a financial house of cards propping it up.

All your base are done. (And don't belong to us)

Privacy first, nation second.

End the Fed.

and last but not least...

Open discussion on TV. First amendment reinvigoration, real issues and real debates.

These banks failing have more to do with a culture of deception than anything else, this needs addressing and again a major investigation must be brought about like a 911 truth movement style investigation but maybe with voting oversight over the people that brought this about.

reply to post by angelonmyshoulder


You are living in a different system than the 1930's. A much different system. You are assuming that the system will fail and rebound the same way. It won't. I wish I could give a more depth reply but Im off to my two wednesday classes. I'll see you all mid day (2pm) and we will see if the stocks spike, or if I was too optimistic and they just level out.

reply to post by angelonmyshoulder


Yeah, it's a 2 year loan. Bad comparison.

www.reuters.com...

FACTBOX: Key stumbles in recent AIG history

Below are some key dark days in the 89-year-old company's recent history.

2005
February - Former New York Attorney General Eliot Spitzer and the U.S. Securities and Exchange Commissioner send American International Group subpoenas about "non-traditional insurance products and certain assumed reinsurance transactions.";

March - Hank Greenberg, who had led AIG since 1967, is forced out as CEO and replaced by longtime lieutenant Martin Sullivan;

May - Spitzer files a civil suit against AIG, saying the company, Greenberg and former chief financial officer Howard Smith, used "deception and fraud" to inflate the stock's price;

2006
February - AIG settles with SEC and state securities and insurance regulators, agreeing to pay $1.6 billion to resolve claims of improper accounting, and bid rigging;

2007
August - As the U.S. subprime mortgage crisis worsens, the company tells investors it is "very comfortable" with its exposure;

November - After third-quarter earnings fall 27 percent, the company concedes the subprime mortgage crisis is affecting results;

June - SEC begins probing how AIG valued its credit default swaps, which have emerged as a key weakness in its balance sheet;

2008
June - AIG replaces Sullivan with former Citigroup CEO Robert Willumstad after the company posts the second of two consecutive quarters of record losses. Total losses from the subprime crisis reach $18 billion, and total write-downs $25 billion

...the rest is all unfolding before our very eyes....

It should be pointed out here that the federal reserve is not a government entity. The "fed" which is as "federal" as federal express (FedEx) is loaning the money to AIG for an 80% stake in the company. It is not the "government" bailing them out. I think that these bailouts are just delaying the inevitable demise of our economic system (which is brought to us by the federal reserve policies in the first place). Could it be that the fed is looking for more power and control than it already has?

This is simple.....it's called COMMUNISM! Government now basically owns the mortgage system, and will now own a big part of the insurance system. Bottomline, IMHO, this is theft of wealth in this country, and now the govt owns a good share of it. The energy (OIL) industry is next...mark my words!

reply to post by grimreaper797


Grim, the joke is on us, they are printing something like 600 million a day and giving it away like after dinner mints. The truth of the matter is the money is worthless anyway. How long do you think it will be before a loaf of bread is 100 dollars. It is even possible that we could have printed 10 trillion dollars. For the debt to be that we should have printed it, right. Is buying a company out at 2.00 really saving anyone? Grim help me understand because it seems that the damage is done what ever the GOV does.

AIG 52 week High 70 low 2
BSC 180 2
FNM 60 .50
fre 60 ..30

So these are just a few but if I bought the stock at 50 and now they save me at 2.00 should I feel better that I lost 48.00 per share.