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View Full Version : AIG reports record $61.7bn loss


edesignuk
Mar 2, 2009, 06:11 AM
Insurance giant AIG has reported a loss of $61.7bn (£43bn) in the final three months of 2008 - the largest quarterly loss in US corporate history.

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

The new measures will also effectively cut the interest payments the insurer must pay to the Federal Reserve.

AIG has already received $150bn in financial support - the biggest bail-out by far of any US company.BBC (http://news.bbc.co.uk/1/hi/business/7918643.stm).

Really and truly boggles the mind. How to you wave goodbye to $61bn in 3 months???

Although I realise they're in different industries, these guys make RBS (http://news.bbc.co.uk/1/hi/business/7911722.stm) look good :eek:

arkitect
Mar 2, 2009, 06:13 AM
Jeeezus.
I think I will have to dig up our whole back garden and turn it into an allotment the way things are going.

:o

Lord Blackadder
Mar 2, 2009, 01:24 PM
**** 'em, I say. I wish I was considered "too big to fail". :mad:

PlaceofDis
Mar 2, 2009, 02:07 PM
spending this much money... on one company alone...
we might as well wipe everyone's debt and start over. would probably be more efficient at saving the economy.

Lord Blackadder
Mar 2, 2009, 02:09 PM
we might as well wipe everyone's debt and start over. would probably be more efficient at saving the economy.

Especially if by doing so we could rid ourselves of AIG and dump all of its execs out on the street.

hexonxonx
Mar 2, 2009, 02:41 PM
So when this company goes through the money we send them again, in a month or two, do we send them more?

Lord Blackadder
Mar 2, 2009, 02:57 PM
There's something truly disgusting about the way that all these business tycoons have no scruple about going to Washington and groveling in front of the world for money - money is everything to these people and they will do anything it takes to maintain their wealth - that's all they care about. On top of that, the "business" they run is of dubious value to society - what do they do that makes such a massive contribution to the world? They are filthy for-profit money handlers, nothing more.

Reminds me of the old biblical parable about the moneylenders in the temple. I'm no religious fundamentalist, but the story has a certain appeal at the moment. I wouldn't mind if the the big J showed up right now and planted his superhuman, sandal-clad foot up some of these rich bastards' asses right now. :mad:

It is shameful and base...can you tell this ticks me off? :o

joepunk
Mar 2, 2009, 04:02 PM
So I'm guessing this might affect shirt sponsoring of Manchester United, eh?

Lord Blackadder
Mar 2, 2009, 04:46 PM
So I'm guessing this might affect shirt sponsoring of Manchester United, eh?

Yeah, right now they are sponsored by the US Treasury Department. :o

miniConvert
Mar 2, 2009, 04:57 PM
**** 'em, I say. I wish I was considered "too big to fail". :mad:
Love that. And I sort-of agree, there has to be a better way... no 'business' should be propped up by the state. Anything that's so essential should be in the public sector anyway, IMHO.

That sentiment goes for banking, too. I'm increasingly in favour of banking being a 'public service'. Then I look at Royal Mail, who these days are only capable of delivering cards that ask for more money before you receive your letter, and the Met Office, who would've had more chance forecasting the economic crises correctly than tomorrow's weather, and reconsider.

Lord Blackadder
Mar 2, 2009, 05:23 PM
Then I look at Royal Mail, who these days are only capable of delivering cards that ask for more money before you receive your letter, and the Met Office, who would've had more chance forecasting the economic crises correctly than tomorrow's weather, and reconsider.

I'm more a capitalist than a socialist, don't get me wrong. But for a bank, which made certain people a lot of money, to earn a big bailout just because they did a horrible job as a bank is, well, simply wrong. We may be compelled to help them for various reasons - but we should make them pay for their mistakes as well.

tigres
Mar 2, 2009, 06:47 PM
So when this company goes through the money we send them again, in a month or two, do we send them more?

Of course we do, the Gov't gave them 30b more to squander away. WTF.

You watch, they will be falling down before the end of this year.

IJ Reilly
Mar 2, 2009, 09:17 PM
Of course we do, the Gov't gave them 30b more to squander away. WTF.

You watch, they will be falling down before the end of this year.

This won't be allowed to happen, and you'd better hope it doesn't, unless standing in a soup line sounds good to you.

hexonxonx
Mar 2, 2009, 10:44 PM
This won't be allowed to happen, and you'd better hope it doesn't, unless standing in a soup line sounds good to you.

Well we can't just keep handing them $30 billion every two months. This madness has to stop. If they fail, they fail.

GSMiller
Mar 2, 2009, 11:00 PM
So when this company goes through the money we send them again, in a month or two, do we send them more?

Probably.

iPhil
Mar 2, 2009, 11:00 PM
AIG was losing $84K or £1,645 per second.... (in that record loss quarter) :mad: :confused:

IJ Reilly
Mar 3, 2009, 12:36 AM
Well we can't just keep handing them $30 billion every two months. This madness has to stop. If they fail, they fail.

Unfortunately they are far too big and far too integrated into the financial system to be allowed to fail. If they go, what's left of the banking system goes with them, and all the rest of us over the cliff right after. When all of this is over, the taxpayers will own probably half of the nation's banking and financial companies. We have no choice. It's tragic but true.

MacNut
Mar 3, 2009, 12:58 AM
So AIG had to pay the banks for all the failed loans that were insured. Now the government is bailing out AIG. So why not just skip the middle man and just bail out all the mortgages.

So AIG was insuring the banks who supplied the mortgages, the money didn't exist in the first place because the mortgages were bad to begin with. So what is there to insure. Someone is making out with money that didn't exist in the first place.

tigres
Mar 3, 2009, 08:57 AM
This won't be allowed to happen, and you'd better hope it doesn't, unless standing in a soup line sounds good to you.

Don't miss interpret my post by thinking I want this to happen. Simply put, I think the term for this in ENABLING.

Sometimes when you’re bleeding out, the influx of transfusions cannot save the patient. I hope for all our sakes they survive; however just answer me this...

At what point do we stop giving blood?

Lord Blackadder
Mar 3, 2009, 09:39 AM
We have no choice. It's tragic but true.

The upside (if there is one) is that, after we do stabilize the economy (assuming we can), we can take steps against companies like AIG to (hopefully) prevent them from getting us into this kind of trouble again.

I hope I haven't over-qualified that statement, but I'm cynical. :rolleyes:

IJ Reilly
Mar 3, 2009, 10:19 AM
Don't miss interpret my post by thinking I want this to happen. Simply put, I think the term for this in ENABLING.

Sometimes when you’re bleeding out, the influx of transfusions cannot save the patient. I hope for all our sakes they survive; however just answer me this...

At what point do we stop giving blood?

That's quite a mixed metaphor. All I know is what I've been hearing and reading. If AIG goes, the dominos fall straight through what's left of the banking system. When that's done, we can all crouch around fires in our caves and congratulate ourselves for not being "enablers."

The upside (if there is one) is that, after we do stabilize the economy (assuming we can), we can take steps against companies like AIG to (hopefully) prevent them from getting us into this kind of trouble again.

I hope I haven't over-qualified that statement, but I'm cynical. :rolleyes:

The government is going to own AIG, but even the rest of the surviving banking system will be fairly begging for new regulations. I heard last night that the division of AIG that caused the company to fail so spectacularly was only 350 employees in size, in a company of tens of thousands. This small division exposed the company to enough risk through credit default swaps to bring the entire enterprise down. Amazing. It could not have been any more destructive if the operation was planned by terrorists.

Lord Blackadder
Mar 3, 2009, 10:26 AM
Amazing. It could not have been any more destructive if the operation was planned by terrorists.

That's interesting, as well as terrifying. The GOP is crying bloody murder over the Dems' plans for regulation, but I can't see any alternative to regulation when a small number of people can bring the world economy to its knees...and not even go to jail for it. :mad:

Willis
Mar 3, 2009, 06:51 PM
Love that. And I sort-of agree, there has to be a better way... no 'business' should be propped up by the state. Anything that's so essential should be in the public sector anyway, IMHO.

That sentiment goes for banking, too. I'm increasingly in favour of banking being a 'public service'. Then I look at Royal Mail, who these days are only capable of delivering cards that ask for more money before you receive your letter, and the Met Office, who would've had more chance forecasting the economic crises correctly than tomorrow's weather, and reconsider.

On what grounds are you able to say Royal Mail can only deliver cards stating that a letter has the insufficient postage?! It's called revenue protection. Royal Mail's issues are with its management higher up. Us posties get the grieve from it!

/rant