Thursday, September 30, 2010

Everyone Claims Profits With AIG Bailout: Next Time A Company Looks Iffy Just Do Another AIG

With regards to the AIG news that it will repay its debts, they have really done it now.

"The insurer will transfer interests in special purpose vehicles holding stakes in AIG divisions to the Treasury from the Fed. AIG will tap as much as $22 billion from a Treasury facility for the transactions, which involve non-U.S. divisions American Life Insurance Co. and AIA Group Ltd".

Is that TARP they are tapping into?

The Fed, treasury, probably AIG too,  are actually claiming an eventual profit on the transaction. Everyone is claiming a profit on the transaction! Wow, print money to make money.

Phillip Phan, professor at the Johns Hopkins Carey Business School in Baltimore: "The government got lucky because the markets recovered and it looks like the bailout will work,” [...]  next time a company starts to look iffy, it becomes a very convenient argument to jump in and say, ‘We’ll do another AIG.’”

Unbelievable, simply unbelievable.

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