AIG to Dole Out $165 million in Bonuses

Don't you think it may have been easier for AIG to file bankruptcy and then the govt sell off the parts of the business to the highest bidder?

I find it very hard to believe that if AIG goes under that the world is going to end under your doom and gloom scenario there.

Not to mention the govt could have used some $200 billion now it has given AIG to secure some of these areas of your concern? Or even have helped a healthy company take on some of these challenges.

AIG, the name, is finished. Chop it up, sell it off, and move the F on. Money Pit!

As it pertains to the bonuses that everybody is flipping over. A contract is a contract. The Govt is a run by a bunch of morons and that is that.

 

Letting AIG fail would have been a disaster and the wrong move imo. They are intertwined in everything. Their collapse could have brought down the whole financial industry. that is the one industry we simply can't let fail.

 

Care to speculate who that highest bidder might be? It's workable if you want to dump a trillion dollars worth of assets for a couple million.

Then don't believe it. I'm just giving you the facts.

Why would you bail out a healthy company?
The gov't has given $175 of which $35B has been repaid and another $30B is available but not yet used, although it will be.

It won't be the giant that it is now, that's for sure. Do you favor just eating the billions and giving up?

I don't like the payout of bonuses and the message it sends, but we're talking about $163MM which is a relative drop in the bucket compared to the spending that's going on by this administration. The media outrage borders on the hysterical and I have heard very few factual accounts. O'Reilly screamed that the bonuses were $1.2 BILLION, a Republican congressman suggested that AIGFP execs commit suicide and Elijah Cummings suggests outright fraud. I mean, come on.

 

I'm starting to think that the money would have been better spent to insure the areas that would be in trouble if AIG went under rather than just hand the money over to AIG. Would that have been more expensive?

 

DarkHornet summed it up nicely right there.

The failure of a failed business implies nothing with the future of everything else. Would it have an impact yes. But I would argue that impact would have been for less for far shorter than this current run of open ended Govt. money.

Should have let it fail as most business would and still do. And then pick up the peices and move the F on.

The economy need confidence. AIG does not produce that.

 

@SF: Do you honestly think that a couple trillion dollars of "worthy" assets are going to sell for millions. I mean come on. While it would be sold for less than what you think it would sell for what the market determines and that is what the real worth would be. Not some fantasy number.

And it has nothing to do with eating the billions and giving up. I mean that is your same argument with Iraq. While not quite apples and apples AIG as a whole is a failure. Scrap it, sell it, start over.

 

Again, who has the wherewithall to buy up these assets? Part of the problem is that there are no buyers able or willing to pay fair value. They are trying to sell. How would it be different if Uncle Sam were the seller?

Why do you argue about something that you know nothing about?

 

If only it were that simple. I'm thinking it would have cost about 2 trillion to do that.

 

Okay, so explain to me how all of the people who have insurance with AIG and all of the business who have insurance with AIG (by the way, it would touch almost everyone in some form or fashion), would be insured. Do you suggest the feds take over acting as an insurer?

Let's see, many businesses could not get insurance or loans. You're right, that would not be a major issue. That's how a recession turns into a depression and in the words of Gust Avrakotos "that's something you want to keep an eye on"

Wow. Every businessman and economist has been trying to determine the value of CDS's these days and CDO's, particularly synthetic CDO's to no avail and yet you simply dismiss it as "the market will determine the price". What you have to understand is that literally no one can value these things. Even if they could, there is no cash to buy them. The market is dried up and the assets are almost impossible to value, this is how you sell potentially billions of dollars in assets for pennies on the dollar. Everyone agree they have some value, but no one is able to pay even what they think they may be worth.

 

Oh I forgot. You run your own billion dollar business and know it all.