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Thread: AIG reports record $61.7bn loss

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    shocked2 AIG reports record $61.7bn loss

    BBC NEWS | Business | AIG reports record $61.7bn loss

    Insurance giant AIG has reported a loss of $61.7bn (£43bn) in the final three months of 2008 - the largest quarterly loss in corporate history.

    And the firm will receive an extra $30bn from the US government as part of a revamped rescue package.

    AIG has already received $150bn in financial support - the biggest bail-out by far of any US company.

    Stock markets slid sharply as AIG's plight underscored fears about the health of the global financial system.

    The Federal Reserve and the Treasury said that AIG posed a "systemic risk" to the global financial system.

    "The potential cost to the economy and the taxpayer of government inaction would be extremely high," they said.

    "The additional resources will help stabilise the company, and in doing so help to stabilise the financial system."

    As well as insuring households, AIG plays a key role in insuring risk for financial institutions around the world.

    The news of AIG's historic loss comes as HSBC, Europe's biggest bank, seeks to raise £12.5bn ($17.7bn) to strengthen its finances following a 62% fall in annual profit.

    BAIL-OUTS RECEIVED
    AIG - $180bn
    Bank of America - $45bn
    Citigroup - $50bn
    JP Morgan Chase - $25bn
    Wells Fargo - $25bn
    Goldman Sachs - $10bn
    Morgan Stanley - $10bn
    State Street - $3bn
    Bank of New York Mellon - $3bn
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    Re: AIG reports record $61.7bn loss

    Insurance giant AIG has reported a loss of $61.7bn (£43bn) in the final three months of 2008 - the largest quarterly loss in corporate history.

    And the firm will receive an extra $30bn from the US government as part of a revamped rescue package.
    How much do you reckon the ex CEOs will get as their golden parachute in pension pay-offs?

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    Re: AIG reports record $61.7bn loss

    The level in which this pisses me off is unprecedented !!!!



    Anybody with me?



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    Re: AIG reports record $61.7bn loss

    Quote Originally Posted by Pitwolfy View Post
    The level in which this pisses me off is unprecedented !!!!



    Anybody with me?




    I am.


    I am about ready to head off to capital hill with my pitchfork and torch, anybody with me here?
    I call my own shots, largely based on an accumulation of data, and everyone knows it.
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    Re: AIG reports record $61.7bn loss

    Quote Originally Posted by americanwoman View Post
    I am.


    I am about ready to head off to capital hill with my pitchfork and torch, anybody with me here?
    I'm going to AIG HQ

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    Re: AIG reports record $61.7bn loss

    If AIG failed it would have profound implications for the stability of the system as a whole; from the point of view of those in government, AIG must be saved at any cost.

    Anyways, more information here. For some reason the article in the OP that I linked to is linking to a different article about AIG, though.

    EDIT:

    Quote Originally Posted by FT
    The new AIG plan – first revealed by the Financial Times last week – would see the government, which already owns an 80 per cent stake in AIG, gain a large holding in two of its most prized assets: American International Assurance (AIA) – AIG’s large Asian operations – and American Life Insurance Company (Alico), a global life insurance business with operations in more than 50 countries.

    AIG would remain as a government-controlled holding company and run the main remaining asset, the US personal lines insurance, according to people close to the situation.

    The company’s foreign general insurance and International Lease Finance Corporation (ILFC), AIG’s large aircraft leasing company, would be likely sold off at a later stage.

    People familiar with the plan said the government would reduce the interest rate charged on a $60bn five-year loan to AIG from the current rate of 3 per cent over the London Interbank Offered Rate (Libor) to just Libor.

    That could save AIG around $1bn a year in interest payments. Insiders said the authorities were also planning to ease the terms on a $40bn-holding of preferred shares in AIG, which are currently paying an annual interest of 10 per cent.

    Financial Times
    Last edited by Khayembii Communique; 03-02-09 at 01:51 PM.

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    Re: AIG reports record $61.7bn loss

    Quote Originally Posted by Khayembii Communique View Post
    If AIG failed it would have profound implications for the stability of the system as a whole; from the point of view of those in government, AIG must be saved at any cost.

    Anyways, more information here. For some reason the article in the OP that I linked to is linking to a different article about AIG, though.
    I agree somewhat. A controlled bankruptcy might be another option. I'm just pissed AIG got themselves into this situation

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    Re: AIG reports record $61.7bn loss

    Quote Originally Posted by winston53660 View Post
    I agree somewhat. A controlled bankruptcy might be another option. I'm just pissed AIG got themselves into this situation
    There is nothing called a controlled bankruptcy. A bankruptcy is a bankruptcy, a very negative thing.

    Also the US government had no choice. There are estimates that a bankrupt AIG could potentially cost 100 million jobs world wide and would take most of the major US banks and big business with it.
    PeteEU

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    Re: AIG reports record $61.7bn loss

    Quote Originally Posted by PeteEU View Post
    There is nothing called a controlled bankruptcy. A bankruptcy is a bankruptcy, a very negative thing.

    Also the US government had no choice. There are estimates that a bankrupt AIG could potentially cost 100 million jobs world wide and would take most of the major US banks and big business with it.
    Who are the estimators?
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
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    Re: AIG reports record $61.7bn loss

    Is AIG even savable? At this rate AIG alone will be hemorraging a quarter of a trillion dollars a year. Add in the stimulus and the wars in Afghanistan and Iraq and the amount of money that the government is spending is simply mind boggling. It can't be sustainable.

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