Oh, About That Loan...

You all might describe it as a dire situation when the government...and by government I mean you, the taxpayer...has to give 85 billion dollars to the largest insurance company in the country, only a few months after our fearless leader...and by fearless leader, I mean lying sack of shit...declared that it's not a "government's" responsibility to bail out private enterprise, and you'd probably be right. Of course with every dark cloud there's always a silver lining. So where do we turn?

Remember those condescending commercials with the annoying little rug rats concerned over their parents' future that made you feel like an idiot if you weren't with AIG? Well, as of just this last weekend, they were still running. Now, not only do they not make you feel like an idiot (unless of course you are with AIG), but they're absolutely hilarious!!!

Unfortunately, you won't be seeing these ads anymore because they're completely fucking retarded now pulling them is going to save AIG what amounts to a whole one tenth of a percent of that 85 billion dollar loan.

A couple more gems after the jump...

SoJ: Adage via Gawker

Comments

[Newman]

I forgot all about those ads. That's lolzy.

[Mr. Kruger]

And as long as we're rescuing Wall St from itself we might as well bail out the auto industry too. It kills me- these corporate fucks get billions in tax payer subsidies only to lose it all and then we bail them out so they can do it all over again. We need to call this the "free-ride market".

[Assman]

And as long as we're rescuing Wall St from itself we might as well bail out the auto industry too.

From what I understand, we had to bail out AIG b/c, if we didn't, we'd upset our Chinese investors who'd be losing money in the deal. And since they're our only supply of cash these days, what choice do we have?

Mark Cuban had a good rant going the other day about how this economic collapse is partially due to CEO's not having any accountability after their golden parachutes are set. They get $20 million if the company fails, so what's their incentive to keep the firm afloat?

[phil]

From what I understand, we had to bail out AIG b/c, if we didn't, we'd upset our Chinese investors...

Actually, the Mae and Mac takeovers were mostly about Chinese investment, whereas AIG was more about making sure Joe Average didn't lose his insurance coverage. At least that's the rationale.

Still don't know how I feel about all of this. If you want to take it to the logical extreme, the government should bail out any of us that have the same problem.

[Mr. Kruger]

From what I understand, we had to bail out AIG b/c, if we didn't, we'd upset our Chinese investors who'd be losing money in the deal. And since they're our only supply of cash these days, what choice do we have?

AIG has obligations world wide. The Chinese can handle their share easily enough. Plus, there are a lot of subdivisions of AIG that are still functioning and making profits that can ease those debts gradually. The thing to do is let the market run its course, that's the whole point of capitalism, you reap what you sow. Maybe the best part of extreme deregulation is that its a great reminder of how stupid it is.

My concern is whose going to pay US back if AIG can't get back on its feet. They're talking about putting the Bureaucrats in charge of the company. That's pretty fucking scary since they're the ones who allowed this mess to spiral out in the first place.

[Assman]

Maybe the best part of extreme deregulation is that its a great reminder of how stupid it is.

Anyone who's ever played a game of Monopoly to the very end could have told you that. There's only one realistic endgame with unbridled capitalism.

[Dr. Tim Whatley]

This whole thing stinks. That's all I got.

[H.E. Pennypacker]

Free-marketers want the government out of business' way. But when the chips are down and firms are going tits-up, that's when unfettered capitalism doesn't look quite so good, eh?

Big business is having its cake and eating it too. Even if we set aside the fact that, if the Fed didn't bail out AIG, a whole shitblizzard would've been experienced worldwide, it seems like a tightening of government regulations seems to be in order, pronto -- even (or especially) if it makes Milton Friedman spin like a lathe in his grave.

[phil]

This whole thing stinks. That's all I got.

Absolutely does.

McCain has suggested a "911 style commission" to investigate the current state of the economy. Whether or not it's 911 style, I think there needs at least to be a look at the sub-prime mortgage debacle. There are a lot of people who made a lot of money in the process of tanking the economy.

[phil]

My concern is whose going to pay US back if AIG can't get back on its feet.

The theory is that the bailout is a loan. This has worked in some cases in the past, and the government has actually made money (see Chrysler for example).

One obscure part of AIG's business is the leasing of aircraft:

"With a diverse portfolio approaching one thousand modern Boeing and Airbus jet aircraft, ILFC [a sub of AIG] is uniquely positioned to address the growing demand for aircraft leasing by offering the most cost-effective and flexible options in the business. Among the world's largest airline lessors with 500 or more aircraft in their fleets, ILFC is distinguished by its ownership of one of the youngest, most advanced leasing fleets in the world." (quote from their website).

Estimates of the value of this fleet approach the payback of the bailout, depending on who you believe. I also had to giggle that the AIG motto is "The Strength to Be There".

At any rate, it seems there is some level of collateral backing this thing up.

[Dr. Tim Whatley]

Big business is having its cake and eating it too. Even if we set aside the fact that, if the Fed didn't bail out AIG, a whole shitblizzard would've been experienced worldwide, it seems like a tightening of government regulations seems to be in order, pronto -- even (or especially) if it makes Milton Friedman spin like a lathe in his grave.

I agree with some re-regulation of the financial industry. I never agreed with the repealing of the Glass-Steagle Act with the signing of the Gramm/Leach/Bliley Act in 1999. I always liked the idea of Insurance companies doing insurance, banks doing banking and securities firms handling securities.

Not to wax political here, but I find it mildly humorous though, that the original legislation to allow such changes was passed by a Democrat controlled congress and signed by a Democrat President (Clinton). The same party whose candidate for President is calling for the reforms of our Financial marketplace.

[Jack Klompus]

"Not to wax political here, but I find it mildly humorous though, that the original legislation to allow such changes was passed by a Democrat controlled congress and signed by a Democrat President (Clinton). The same party whose candidate for President is calling for the reforms of our Financial marketplace"

What? Come on. Everyone knows this is because of George W. Bush and the Iraq War. It has nothing to do with the Community Reinvestment Act. And you shouldn't pay attention to the contributions Democrats receive from the financial sector, namely Freddie and Fannie. It's merely a coincidence. And even though Democrats blocked the passage of the Federal Housing Enterprise Regulatory Reform Act of 2005, it has nothing to do with anything. It's about oil! And war! And global warming!

[Mr. Kruger]

It's about oil! And war! And global warming!

It's about socialism for the rich and capitalism for everyone else.

[Assman]

It's about socialism for the rich and capitalism for everyone else.

Well, rich people deserve bailouts because they pay everyone else, remember? Trickle down economics?

In fact, those CEO's deserve their $20 million safety nets because they need them to finance the safety nets of all the little people that also lost their jobs that day.

[jet leasing]

I don't know about this topic more.But By reading your post I got impressed.Now I am interesting to know more about this.