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What does it mean to me? It's one of the major reasons I haven't been around much recently. It's revealed a lot of flaws in the insurance market. AIG is one of my major trading partners, and it's been a wild ride.
The bailout had to happen. If it hadn't, approximately 50% of the US airline fleet would have been grounded since the owners of the planes require the hull insurance to be rated "A" or better by AM Best (the standard insurance rating service). If AIG had declared bankruptcy, none of those planes could have flown since AIG writes roughly 50% of that business. That's not to count all the other corporate business that AIG writes that have similar covenants.
The bonuses were stupid. AIG could have gotten out of them. Dodd's an idiot for allowing them to happen.
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"They that can give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety." - B. Franklin
"There ought to be limits to freedom." - George W. Bush
"We have met the enemy and he is us." - Pogo
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