Ditto for those in other companies who were similarly irresponsible. Lack of accountability ----> loss of confidence is weighing heavily on the markets.
So he's essentially saying "I know my replacement lied because he spun the same story I spun when I was CEO". Brilliant.
In one sense yes they have failed. But the point Bernanke is trying to make is he is choosing the lesser evil. He does not want to put the insurance units in bankruptcy because of how intertwined AIG is around the globe. If this happened for example, people would not know what the life insurance policies they bought from AIG are worth. God only knows how institutions and pension funds would be damaged by the AIG bankruptcy.
Instead of indulging in righteous indignation, does Bernanke have an actual plan to propose that will prevent this from happening again?
not necessarily true. depends when the CDS exposure was put in place. if the exposure was put in place after he left as CEO, the lawsuit could have merit.
It wasn't. Greenberg was already under investigation in 2005 for off-balance-sheet transactions and derivative dealing. It was Greenberg that lead the company away from its core insurance business and into "financial services". To these eyes, this looks like a dying old man desperately trying to save something of his legacy. Which is sad, of course.
You're right, the plan was to let Lehman fail to cause the shockwaves then save everyone else because they were his buddies and rich friends. The shockwaves will destroy the world economy with the US coming relatively on top.
Are the same crooks still running AIG are have they fired a bunch of Dumb butts that caused this mess? Also, isn't there other LEGIT insurance companies that don't have crooks(probably none) at the top that could step in and take control of AIG at what its' really worth and then just move on? What ever happened to FREE MARKETS? The damn FED is in competition with every Insurance company in the world right now. As a trader that has lost money in the past I want the FED to bail my losses out also and everyone else in the world that has lost money on bad investments, so I think we should picket the FED to get this done! WHO IS WITH ME!!!!:eek: FREE TRADES FROM THE FED!
AIG is worth less than zero. No other company would assume its liabilities and assets. Its a $300B blackhole. The premise is that letting AIG default on its obligations would cause more financial loss than it costs to just continue to prop it up with these gov't infusions. Note that Bernanke is mad at AIG for what they did in the past but he is not suggesting that we let them fail. Everyone loves to jump on the "just let them all fail so we can move on quicker" bandwagon but if the gov't actually did that I think the short-term results would have folks calling for Obama's impeachment. Things could be a lot worse than they are now. A lot.