Quote:
Originally Posted by dippin
Do you know who is insured by AIG? What they insure against?
They underwrite insurance, do "corporate insurance," and actually insure financial instruments used by other banks and funds. If they go broke, not only will everyone who's invested in AIG lose money, but insurance companies, banks and funds will go under as well. If they go under, not only will the "zombie" banks lose money, but also many other healthy banks.
That would make the current situation seem like nothing.
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This would seem to be a very good argument not to allow megagiants like AIG to exist. The "all your eggs in one basket" scenario.
Additionally, if it's so very vital to our economy that AIG survive, why were they just handed money without any requirements as to how they spend it. Personally I think it's more important to keep a company afloat than to pay a boatload of executives millions of dollars
each in bonuses, but apparently Vital Financial Backbone AIG doesn't see it that way.