Why is the Federal Reserve working so hard to bail out AIG? Well, maybe you do not realize this, but AIG is a world-wide company, it is one of the largest companies on the planet. It insures nearly every building, airliner, ship, oil platform and re-insure lease agreements and deals around the World. They are a huge life-insurance company. They have a 10 Billion Dollar aircraft leasing business, they have the largest network of broker dealers and financial planners.
They are the ones who insure and re-insure in case of huge calamities, and have the ability to hold up entire economies if catastrophe strikes. They operate in over 100 companies, they even have insurance policies based on Sharia Law if you can believe that, and in China, it's AIG or no one. See, how big it is? See why it's so important to the world economies? If we allow AIG to go bust, the ripple effect will take out a huge number of companies.
They insured the deals behind Lehman Brothers and so many other investment banks. Can you imagine if all those policies simply stopped? No one would have insurance, no financial asset would be safe, every major company would have their financial credit rating downgraded. Our stock market would lose 2,000 pts and other world stock markets would simple collapse and trillions of dollars would evaporate in an instant.
The Japanese Stock Market was up along with other stock markets round the world as soon as news hit the wires that a deal to loan the company was reached. This loan will enable AIG to make good on all its obligations and insurance deals. AIG is not a company that is full of corruption, not even a little bit, it's one the best companies on the planet in fact.
AIGs recent problems stemmed from exposure to runaway bubble games in the subprime lending fiasco, that took down some of the largest investment banks in the United States and still threatens regular banks in the US and Foreign Banks. AIG's government backed "loan" is a god's send to our trading partners right now and this move most likely saved the US economy from "certain death" in this Earthquake that rocked the financial world like a Hurricane the threatened to blow our house down. Think on this.
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