AIG in "Conservatorship"

[don]

Re: AIG in "Conservatorship"

Henry Paulson’s Frankenstein

This is how a federal bailout works these days.


The government purchases 79.9 percent of the company in question. It can’t be more than that, because if it goes over the magical number of 80 percent, the company’s debts are then required to be consolidated onto the federal government’s balance sheet. Keeping it at 79.9 percent allows the government to maintain the fiction that it is still not responsible for the company’s solvency.


The purchase isn’t even a purchase of the stock of the company. Rather, it is a purchase of warrants giving the federal government the right to buy some number of shares. This permits the federal government to further claim that it doesn’t even have an ownership interest.

http://dealbook.blogs.nytimes.com/20...-frankenstein/

[raja]

Re: AIG in "Conservatorship"

"T"
Am after a nice female, any going by you?
Mike

Mega,

I recommend a village girl from the FSU (e.g., Ukraine) -- at least thirty years old. At that age, they've lived through the Soviet collapse and know how to cope with hard times. They can raise chickens, milk cows, cook, chop wood and pinch kopeks. That would be hard to find in the US. (statistically speaking).

[Supercilious]

Re: AIG in "Conservatorship"

Henry Paulson’s Frankenstein

This is how a federal bailout works these days.


The government purchases 79.9 percent of the company in question. It can’t be more than that, because if it goes over the magical number of 80 percent, the company’s debts are then required to be consolidated onto the federal government’s balance sheet. Keeping it at 79.9 percent allows the government to maintain the fiction that it is still not responsible for the company’s solvency.


The purchase isn’t even a purchase of the stock of the company. Rather, it is a purchase of warrants giving the federal government the right to buy some number of shares. This permits the federal government to further claim that it doesn’t even have an ownership interest.

http://dealbook.blogs.nytimes.com/20...-frankenstein/

That's nothing. This is how the bailout will work tomorrow:

CNBC anchor to his colleague: 'Dick, oh my God, you're not going to believe this, it's just come in on the wires. "Amid imminent collapse US government to take over the $1.6 trillion Vanguard private equity fund".

Dick goes pale, undoes his tie, and starts hyperventilating. 'It's over, the whole shooting match, we're cooked. I just can't believe it...it's the end of capitalism. Sell everything.'

'Wait Dick, just hold on there, they just issued a correction; now it says "Amid imminent collapse the $1.6 trillion Vanguard private equity fund to take over US government"

Dick recovers his composure. 'Jeez, you had me going there, so what they paying?'

All the Wall Street institutions collapsing now are only empty carcasses of dilapidated piggy banks.

The real dough had been quietly exiting the room for the past five years .... It's now dancing happy and free (of any regulation ) on the sunny fields of private equity markets .... errr .... private markets for equity .... errr .... private markets for private equity donated by the taxpayer....

[ASH]

Re: AIG in "Conservatorship"

This isn't quite the same topic, but I thought I'd pass along something that I only just started to think about:

According to the FDIC, corporations are only insured up to $100k, same as everyone else, and they gain no benefit by splitting deposits amongst multiple accounts at the same institution.

I had been thinking about the prospect of bank failures from a strictly personal standpoint -- where my own checking and savings accounts are held. What I hadn't considered is that I work for a small business that happens to bank at Washington Mutual, and the business's accounts exceed the FDIC limit. Absent a federal bailout over and above the FDIC deposit insurance, it strikes me that a failure of Washington Mutual could adversely affect my employer's ability to stay in business. Thus, for those of us who are still working, there are some externalities to contemplate.

[Slimprofits]

Re: AIG in "Conservatorship"

AFP reports from Singapore

In Singapore, hundreds lined up outside the company's local headquarters while more than 1,200 descended on the Taipei offices of AIG subsidiary Nan Shan Life Insurance.

About two dozen anxious customers crowded into a small AIG subsidiary office in Hong Kong, where RTHK radio, citing government sources, reported more than 1,500 insurance policies with the subsidiary had been terminated in two days.

[*T*]

Re: AIG in "Conservatorship"

"T"
Am after a nice female, any going by you?
Mike

Only the wife-to-be, and you couldn't afford her ;)

Not sure about your cheap American wife theory though - surely we will get UKwives.co.uk at about the same time?

[Slimprofits]

Re: AIG in "Conservatorship"

AFP reports from Singapore

In Singapore, hundreds lined up outside the company's local headquarters while more than 1,200 descended on the Taipei offices of AIG subsidiary Nan Shan Life Insurance.

About two dozen anxious customers crowded into a small AIG subsidiary office in Hong Kong, where RTHK radio, citing government sources, reported more than 1,500 insurance policies with the subsidiary had been terminated in two days.

Is this getting coverage on American TV?

Is it (lack of a policy-holder run) a clear sign that Americans by and large still have faith in the Treasury Dept. and the Fed?

[ASH]

Re: AIG in "Conservatorship"

Is this getting coverage on American TV?

Is it (lack of a policy-holder run) a clear sign that Americans by and large still have faith in the Treasury Dept. and the Fed?

I think it is a sign that most Americans are unaware that there is systemic risk. There are undoubtedly worries about personal finances, retirement account balances, and job security. However, I get the impression that:

(A) Most Americans blame some combination of their political leaders, corporate interests, and individual irresponsibility for the present crisis, but aren't conversant in the details, and hence have no way to assess the specific systemic risks. They are likely to gripe about their personal hardships and express concerns about their future, but in general the sentiment is tsk-tsk for official incompetence and corporate greed, rather than alarm about the potential failure of the financial system. Everyone is resigned to losing money in the market, but very few have considered that their "safe" assets may be at risk.

(B) Those who are vaguely aware of systemic risks still believe in the basic competence of the financial authorities, and in any case are inclined to believe that the g-men can save the system, for the simple reason that the thought is comforting. The alternative, after all, is terror and chaos.

[The Outback Oracle]

Re: AIG in "Conservatorship"

As itulipers we have ended up here as a group because we 'saw" this thing coming one form or another. My current feeling is however that I didn't reckon on the real fear that i feel for the welfare of my family who are scatttered in various parts of the world. I've done the best i can to prepare them with some success. But as this spreads and my worse fears are fulfilled step by step, I am afraid.
It occurred to me yesterday it is a bit like when I was a farmer/'rancher', when it was raining, you knew the droughts would come again. But while it is raining you cannot 'feel' the devastation of drought. Your imagination just can't quite make the transition.
So with this financial crisis, we cannoot 'imagine' what it will be like in the event of a systemic failure.

[Shakespear]

Re: AIG in "Conservatorship"

While GOOGL'ing for info on AIG history as per what I read on AsiaTimes.com I came across this

July 1, 2005 1300 PST (FTW) American International Group's Maurice "Hank" Greenberg is now the target of multiple investigations into the orchestration of sham transactions, the inflation of reserves, illegal stock trades, deception, and book-cooking. In an April television interview, New York Attorney General Eliot Spitzer declared that his office had "powerful evidence" that AIG was "a black box run with an iron fist by a CEO who did not tell the public the truth". In May, Spitzer filed civil fraud charges against Greenberg, in a probe that has ensnared another Wall Street god, Berkshire Hathaway's Warren Buffett. Buffett cooperated with the investigation as a witness (not a target). On June 9, 2005, two executives at General Re (a Berkshire Hathaway unit) pleaded guilty to conspiring to file false financial information. Spitzer is also pursuing Hank Greenberg's son, Jeffrey, in a separate investigation of bid-rigging at Marsh & McLennan (a top Bush campaign contributor). Jeffrey Greenberg quit as Marsh & McLennan's CEO in October 2004.

www.fromthewilderness.com/free/ww3/070105_target_aig.shtml

Could the above be the reason why Mr. Spitzer was removed from office? Was he trying to prevent the mess we see today?

[ASH]

Re: AIG in "Conservatorship"

Mr. Spitzer was removed from office? Was he trying to prevent the mess we see today?

Mr. Spitzer removed himself from office because he was caught using a high-end call girl agency. Frankly, that was too bad (that he failed in his private life), because it seemed as though he was doing some good in his public life.

If Mr. Spitzer died of polonium poisoning, then I would conclude that he was "removed" by others. If Mr. Spitzer denied the liason with the call girl, and claimed that the evidence was lies and forgery, I might have suspicions. But, Occam's razor says he was "removed" by himself.

[D-Mack]

Re: AIG in "Conservatorship"

While GOOGL'ing for info on AIG history as per what I read on AsiaTimes.com I came across this



www.fromthewilderness.com/free/ww3/070105_target_aig.shtml

Could the above be the reason why Mr. Spitzer was removed from office? Was he trying to prevent the mess we see today?

AIG had interesting links with 911, I think you should watch "Who killed John O Neil"

http://video.google.com/videoplay?do...25573970187433
I have never watched it because I'm not that interested in AIG's role or the death of John O Neil


Greg Palast wrote about Spitzer

Eliot's Mess

The $200 billion bail-out for predator banks and Spitzer charges are intimately linked

By Greg Palast
Reporting for Air America Radio’s Clout

March 14th, 2008

[To hear the Podcast of Eliot's Mess read by Palast, click on the link below…]

While New York Governor Eliot Spitzer was paying an ‘escort’ $4,300 in a hotel room in Washington, just down the road, George Bush’s new Federal Reserve Board Chairman, Ben Bernanke, was secretly handing over $200 billion in a tryst with mortgage bank industry speculators.

Both acts were wanton, wicked and lewd. But there’s a BIG difference. The Governor was using his own checkbook. Bush’s man Bernanke was using ours.

This week, Bernanke’s Fed, for the first time in its history, loaned a selected coterie of banks one-fifth of a trillion dollars to guarantee these banks’ mortgage-backed junk bonds. The deluge of public loot was an eye-popping windfall to the very banking predators who have brought two million families to the brink of foreclosure.

Up until Wednesday, there was one single, lonely politician who stood in the way of this creepy little assignation at the bankers’ bordello: Eliot Spitzer.

Who are they kidding? Spitzer’s lynching and the bankers’ enriching are intimately tied.
...

http://www.gregpalast.com/elliot-spitzer-gets-nailed

It remínds me of Larry Craig, everybody has dirt, but only people who have to go get exposed end up exposed

“The White House is particularly pissed at Frist,” says one longtime GOP consultant. “They want him out as majority leader and a more hardball leader in the style of Tom DeLay in his place.”

Bush is also angry with Craig, a conservative who joined with Democrats in a filibuster to defeat permanent renewal of the Patriot Act. As a meeting recently, Bush referred to Craig as “a goddamned traitor” and told the National Republican Senatorial Committee to start recruiting someone to run against the Idaho Senator in 2008.

Such anger against those who dare oppose him is typical for a President who all too often launches into obscene tirades when his policies are questioned. Bush, on many occasions, has called political opponents “traitors’ and, in private, refers to Senate Judiciary Chairman Arlen Specter as a “lily-livered bastard.”
http://www.opednews.com/articles/ope...usionment_.htm

[phirang]

Re: AIG in "Conservatorship"

http://www.atimes.com/atimes/China_B.../JI18Cb02.html

AIG china's connection:

China's imploding US ally
By Richard Komaiko and Chris Stewart

The collapse of US insurance giant AIG and its US$85 billion takeover by the US government on Tuesday takes the US financial crisis right to the heart of China's development as a capitalist country.

AIG, the world's sixth-largest company by assets and biggest insurer, according to the Forbes Global 2000 list for 2007, is one of the few US institutions to be founded in China, its roots dating from 1919 when Cornelius Vander Starr, a veteran of World War I, founded a small insurance company in Shanghai called American Asiatic Underwriters, later to become AIG.

[Jay]

Re: AIG in "Conservatorship"

http://www.atimes.com/atimes/China_B.../JI18Cb02.html

AIG china's connection:

Gosh, that whole thing is weird.

[phirang]

Re: AIG in "Conservatorship"

That's nothing. This is how the bailout will work tomorrow:


All the Wall Street institutions collapsing now are only empty carcasses of dilapidated piggy banks.

The real dough had been quietly exiting the room for the past five years .... It's now dancing happy and free (of any regulation ) on the sunny fields of private equity markets .... errr .... private markets for equity .... errr .... private markets for private equity donated by the taxpayer....

yea, smart money left the long end of stocks ages ago... i'm clearly not smart money, unfortunately!