Wall Street falls on AIG’s biggest quarterly loss in corporate history. The government is willing to pump another 30 billions of tax dollars once again into American International Group (AIG) for the FOURTH time, the first time being in September 2008 when Lehman Brothers collapsed.
Recent bail-outs received:
- AIG – $180bn
- Bank of America – $45bn
- Citigroup – $50bn
- JP Morgan Chase – $25bn
- Wells Fargo – $25bn
- Goldman Sachs – $10bn
- Morgan Stanley – $10bn
That makes a total of $345 billion in the recent bail-outs to some of the biggest financial companies, not to mention the multi-billions of dollars received earlier, and AIG receiving more than THREE times the bailouts received by BOA or Citibank.
The government owns nearly 79.9 percent of AIG’s holdings, which involved a $60 billion loan, a $40 billion purchase of preferred shares and $50 billion to capitalize it’s toxic assets, further spending $30 billion additional capital in return for preferred stock. The Treasury Department said it would convert it’s preferred stock into new preferred shares, similar to common shares. This $62 billion is the highest ever loss recorded in corporate history.
Warren Buffet says the economy is in shambles as a consequences of the US housing bubble, and this will continue in 2009, however gives some hope that the best days for America are still ahead and while it may take time, the economy will recover.
Given the bailouts after bailouts, it would be no surprise if AIG breaks it’s own record once again. Is there a cap on bailouts or would the Obama government go on spending until it has nothing left to spend?
There is already nothing left to spend. Obama is selling into taxpayer servitude your grandchildren and great grandchildren. I think he has the attitude of Wimpy, “I’ll gladly pay you Tuesday for a hamburger today.”
I love your blog. Keep up with the good work.
It seems to me that Obama is determined, (as indeed Bush was) to screw the economy for a generation, but in a totally different way to the last time it was screwed. At least on the up side they are not repeating stuff that we know doesn’t work. This time round the plan of distributing money we haven’t got to the least deserving business men on the planet is a refreshing take on economics. The bankers now have a gamblers charter in which they can’t lose. Whether this protects the bulk of the economy from falling off a cliff is yet to be seen…. but either way we will be paying through the nose for it for years to come