AIG Insurance Company Taken Over By Federal Reserve

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Isn't this about the time for all the conservatives to

chime in about how horrible we 'socialists' in Europe are and how great American capitalism is? You know, 'root, hog - or die' and all that groovy free-market, deregulated everything stuff?

Ye gods and little fish, anybody who still believes the republicans know what they are doing after this mess is seriously out of touch.
 
Whew. Glad the Fed bailed them out. I have a small investment with AIG I'd hate to lose.
 
Good thing you're all going to vote for Obama so the middle class gets a tax break, because when we start paying for these 200-billion dollar bailouts (Freddie Mac/Fannie Mae alone cost that much) today's tax rates will seem like a freakin' bargain.

Then add the cost of the war in Iraq.

Yes, Republicans, you are truly the party of less government intervention, fiscal responsibility and all that stuff.

I'm amazed that ANYONE still believes those things about the Republican party. Lo and behold, many still do! That's not been true for decades, yet somehow they still get mileage out of it.

Oh, well....Hockey Mom will make it all better.
 
AIG's Travelguard division is located in Stevens Point, WI which is about 30mi south of Wausau. The whole town is on pins and needles hoping for the best, time will tell.
 
Employed with aig

My partner worked for AIG and lost his job. I am in school and he was the major bread winner in our family. So our lives just got turned upside down. All his friends too. It reminds me of that movie fun with dick and jane.
 
Old, not very funny "joke"

"When your neighbour loses HIS job, it's a "recession." When YOU lose YOUR job, it's a "depression."

---Anonymous.

It may continue to get worse. I hope and pray that it does not, but.......

"Cultivate friendships, find low-cost pleasures, and pass the meatloaf."

Lawrence/Maytagbear
 
AIG Intervention

Much as one hates to see yet another hand in my handbag, no matter whom was in office, or in control of the Federal Reserve, this sadly was truly a case of horrible things happening if AIG were allowed to file for bankruptcy.

Just reading various posts from members gives a small clue just how AIG is so interwoven into many persons lives, and not just via insurance. Had they gone under, all heck would have broken loose (yes, one knows, and one is also tired of hearing that line as well).

What we the people of the United States must do is rise up and hold feet to the fire and make sure this doesn't happen again. Obviously this "no or minimal regulation" isn't working, and the whole financial system needs to be able to deal with 21st and soon 22nd century issues, not things as they were after the Great Depression.

Mr. Paulson will be gone in a few months, and Bernanke may or not be reappointed, but that isn't the point. These problems were allowed to grow and fester over a period of years, under many successive administrations and state governments. Merely moving the pieces on a chess board around does not change the rules of the game, and there is where things need to begin.

L.
 
the taxpayer ALWAYS loses

It seems the poor bloody taxpayers always have to fork out whenever anything like this happens,I do not see why taxpayers should have to bail out private companies,if we do live in a so-called free market, then these firms should live or (if it comes to it),die under the free market.
Although I do recall in about the mid 1980's there was a bad recession and several State banks( banks actually owned by the state government of the respective state),collapsed and had to be bailed out by taxpayers as the state governments were responsible for them.
The only thing which is sure in these situations, the public always lose.
Cheers folks.
 
Laundress,

As always, has put it well.
I just doubt whether the republicans have the will to work and think this through.
Pure deregulation hasn't worked, too many controls don't either.
It is unfair to expect us to pick up the tab,while the pigs who caused this float down to earth on their golden parachutes.
 
Insurance companies

It couldn't happen to nicer people.

If American Family Insurance starts to teeter towards the edge would someone please give me the heads up. I want to watch them fall.
 
"I do not see why taxpayers should have to bail out private companies,if we do live in a so-called free market"

Some of you folks need to really educate yourselves because your comments are deeply concerning.

When banks, brokerages, and insurers the size of AIG fail, it's not just the company and its employees that goes down the toilet. It has a monumental and highly detrimental affect on millions of lives whose pensions, insurance policies, life annuities, life savings, etc., are housed with these institutions. We're talking catastrophic consequences to millions of innocent people here, many long retired, and many who had no say in the matter as to where their pension funds were housed. (AIG holds many federal pensions). Insurance companies don't just do insurance as we know it. They are highly diversified financial services firms the operate in many financial services areas.

The federal reserve did the ABSOLUTELY right thing. They did not "bail" out AIG, so to speak. They took them over, plain and simple, with the full right granted solely to the fed to fire senior management. This is the right way to do it.

It is the government's role to step in and protect the people from catastrophic financial failures, but it is also their role to regulate to protect that from happening in the first place....and here they've failed DREADFULLY. Their brokering of the deal where JP Morgan Chase took over Bear Stearns was the right thing to do also. Allowing major banks to fail will only cause a 1929-style run on all banks. And given that banks are required to hold only 12% or less of their deposits in reserve, this would quickly bankrupt the system almost overnight.

So quit your bitching about the government bailing out this one and bailing out that one. It's not something anyone wants to see happening, but it is their role to protect the citizens of this country from financial ruin. Granted they've done a shitty job regulating matters, but to let the banking system collapse is utterly irresponsible.
 
Andrew

I agree with you, they did not bail them out they took them into receivership where they will sell off their assets and close them down.

Yes it has a long term effect on everyone, but I will stand by my statement. If insurance companies weren't so greedy in the first damn place it wouldn't give me such satisfaction to see them suffer for a change. Greed my friend will kill the system just like it did in '29. Greed will eventually bring them down, it's just Karma.
 
No sensible

person disagrees with saving their asses. But I deeply resent having to pay for it with my taxes...and still having to see the republican assholes who caused the whole mess at the company get off Scot-free.
Then, if we do get another republican administration, they will turn around and sell it for a few cents to their buddies.

By this point, it should be obvious (again) to even the most idea-bound person that you can't have a 21st century capitalist system (which, as a small business owner I heartily desire) and run it as if this were still an agrarian economy.

Sheesh.

Funny how the single-issue conservatives around here are awfully silent on this.
 
"They took them over." Yeah, great. Now our govt is in the insurance business. Easier for them now to force universal health insurance. Nice. How many other companies are lining up for a govt take over, or a govt loan, or a govt bail out? And when the take over/loan/bailout doesn't work and the company colapses, then what? Oh, just add it onto our national debt and raise the taxes on those who can afford it. They can't close our boarders, they can't get us out of Iraq quick enough, but they can hand out our tax money and then take over businesses just like cake. Nice. And when all this does really colapse, it will be the Democrats pointing the finger at anyone but themselves. Lowest approval rated Congress ever, all lead by the Democrats.

I read in the Times that AIG had a big mortgage division. Then I found this... Got this earlier from Boortz:

1. Almost all of the financial problems we see today are based on bad mortgage lending. That would be lending money to people to buy homes who didn't qualify for a loan.

2. The Democrats, under Clinton, strengthened a government-created monster called the "Community Reinvestment Act." This law was then used by "activists" and "community organizers" (like Obama?) to coerce lending institutions to make these bad loans ... millions of them.

3. Now we see what happens when political "wisdom" supplants good loan underwriting. When private financial institutions are virtually forced to make loans to people with a bad credit and job history .. this is what you get. Enjoy it.

The Democrats have offered us a candidate who is very anti-private sector. Obama believes that America is great because of government and those who, like him, deride the profit motive. If Americans are stupid enough to believe his socialist drivel and put him in office .. .then we will get just what we so richly deserve.
 
PeterH770:

"Lowest approval rated Congress ever, all lead by the Democrats. "

Peter:

Would you care to explain to me why Democrats get all the blame for the dysfunctionality of our current Congress, when it's almost exactly half Republican?
 
Obama isn't anti private-sector; He just wants to make sure they're being held to standards. To say that community organizers somehow coerced lending institutions into making unwise loans simply is not true. As is usually the case, they saw an easy way to make a buck, knowing full well the government would be forced to bail them out when it all came crashing down. Prophecy fulfilled!

I'm stunned by the way-off-base ideas some of you have of the Democratic party.
Once again: Show me how Republicans have limited the size and scope of government or been truly fiscally responsible in the last 30 years. It's a fantasy that Republicans like to keep repeating, but the numbers don't bear it out.

I hear people speak so righteously about things like welfare fraud, yet we pay out hundreds and hundreds of BILLIONS of dollars to corrupt lending institutions and no one seems to be upset. We spend hundreds of BILLIONS on a war which was poorly thought out and probably unnecessary. Where is the outrage?
 
A reminder note

The last 4 Republican Presidents have all said "KEEP GOVERNMENT OUT OF THE MARKET AND BIG BUSINESS, THE MARKET & BIG BUSINESS WILL TAKE CARE OF ITSELF! THATS CAPITALISM AT WORK"

SO WHY IS THE REPUBLICAN GOVERNMENT BUYING OUT FAILING COMPANIES LEFT AND RIGHT??

AND WHY IS NO ONE CALLING THEM TO THE CARPET FOR THIS SUDDEN REVERSAL????
 
It was under the republican congress that the government rules and regulations were removed from the financial institutions in years of 1999-2000.

So the market would have a big BOOM. That is what we heard from the republicans then. Free market! Smaller government! Don't these terms sound familiar to anyone??
Now look who is bailing them all out....

Go ahead, feel free to look it up Pete. I realize that it won't change your mind about how you feel about democrats, but at least you should know the truth.
 
It takes two to tango, and free market (which grew under President Clinton, and the Democrats under their "ownership society" none sense), did not mean for persons to run out and forget common sense.

Suddenly we are asked to believe scores of thousands of persons were somehow hoodwinked into taking out loans without knowing the consequences. While there is no doubt some persons were preyed upon, a much larger number of people (as want their nature), saw their chance and took it.

Persons who haven't paid a bill on time in their lives, bought a home on terms any idiot would have known was bound to fail. If you make $25,000 year, and take home $18,000, but live like you take home $35,000 and get on by scheming, scamming,and borrowing from Peter to pay Paul, then you deserve everything you have coming.

What is wrong with the United States today is too little personal responsibility, and heavy reliance on the government will help, and a good dose of the Scarlet O'Hara view of life "I won't think about that today, I'll think about it tomorrow".

People cry and wail to media reporters they don't understand why they should be made to pay mortgages they agreed upon. Well hello,YOU signed the papers. If one does not understand things, that is what attorneys are for. Time and time again, one hears in response to a media query as to did said homeowners ever look at the papers they signed, and the response is always the same "no, there were so many of them I just came home from the closing/refinancing and stuck them into a drawer". What these people really saying the thought at the time they couldn't believe anyone would be so "dumb" as to give them a home or refinance, and now that it's done and they have theirs, why think about what happens if they cannot pay.

And why indeed, when you have persons like Barney Frank, who in true Democratic style believes it is the government's responsibility to feed, cloth and house all and sundry. There aren't enough letters in the alphabet to name the numbers of agencies Mr.Frank and others like him would love to create.

As if that isn't enough there is Ms. Blair, turning the FDIC into a vast social experimental program on the basis of her own beliefs.

One of the great tragedies of the Great Depression is the mindset it must never be allowed to happen again. While that thought may not be so bad, in it's wake a culture has grown both in government and populace that people and businesses must be protected from the consequences of their own bad decisions, and hard times in general.

Persons like to hate credit scores and other models of human behaviour, but the harsh truth is they work very well at predicting future behaviour. Someone who has not shown a tendency to be responsible in his or her personal life, finances and business affairs, is likely to continue along that same pattern.
 
Whoopie made a good point today...

This morning on The View, Whoppie asked "So is the government going to come in and pay my bills?" Which is a VERY valid point. If the government can pony up billions and billions to protect failed businesses and basically wipe out their debt, why not the average American?

The various managers of these failed corporations ran them into the ground with bad decisions yet the end result is "Never mind..."
 
Whimpee!

PeteK you beat me to it! *LOL*

As for the government paying people's bills, well if you qualify for any of the myraid of mortgage plans, they are, in a degree. For the rest of us poor "slobs" it means nothing put work, work, and more work.
 
PeterH770:

"Because Congress is being run by the Democrat majority..."

Run? Do you mean the Congress that has been unable to override Presidential vetoes because of Republican voting along party lines?
 
The predatory loans that were approved for people that should never have qualified for a loan in the first place would have never happened if the federal rules and regulations had not been removed from the finacial institutions. These rules were removed by the republican congress in 1999-2000. True, the Clintons were in the White House at the time, however, the congress was controlled by the republicans. Remember 1994,
The Contract On Amercia?? Or was that The Contract FOR Amercia?
 

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