I know there must be a thread on this, but I cannot seem to find it.

My BIL is in the reinsurance industry and according to him consumers were never threatened concerning insurance failure and the AIG's consumer insurance units are completely well-capitalized because the law requires it.

We bailed them out because of their financial products division and basically are saving them from their inability to manage risks in investments.

Who else are we going to bailout?

thats; PENNSYLVANIA FIRE and CAUSUALTY.

It appears Sam we are about to bail out everybody. And not just companies that are failing now. I would say the feds mean to bail out all who fail for the foreseeable future.

Maybe even Lehman brothers will be resurrected now. Why not it appears they mean to save everybody.


And your BIL was right . Insurance policies weren't the problem. finanical products like annuities were at the most risk in the AIG mess.

I disagree. The federal government bailed AIG out because of the influence on the "literally trillions of dollars" (according to NPR) in mutual funds, which most people on here are invested in. Therefore, anyone with mutual funds could be threatened. They were also worried that people would lose faith in banks and a possible run on banks could occur. Also, AIG had worldwide implications, not just implications here in the US.

Also, according to NPR, they said that the government might actually make some money off of this because of the assets which can be sold off as well as some gaining some money off of interest.

Even with that I don't think they should have bailed them out. I say let bad companies die, it just makes room for solid companies.

It seems (if rumors are correct) that the big 3 automakers are next in line for the big govt handouts of taxpayer money. I find this to be entirely revolting in all ways. These companies have run themselves into the ground out of sheer greed and it bit them in the ass.... now we get to pay for it. The govt would have done better giving the money to we the people to pay bills with. That would have saved the companies and the citizens... but the govt don't care about the citizens because we don't donate millions to campaign funds etc.

__________________
Drummer, Songwriter
Culture Shock
www.culture-shock.us

Co-Owner
www.pennypincherpromotional.com

Good question and I wonder myself. This is a Catch 22. The situation is a no win because of the problems that have piled up and how they have to get dealt with. They had to take immediate action but bailing out a private company like this sets a bad example.