Jed Clampett

We are beginning to understand why insurance rates of all kinds have been going up up and away.
AIG has monopolized the insurance business and paid it’s highest executives a large amount of the money that was supposed to go for covering the subscribers losses in a catastrophe.
When a hurricane hits, the government comes in and bails the insurance companies out so they don’t loose so much money, which they are supposed to have in reserve. Then the government helps out those that are too poor to afford the extremely high rates of insurance. Government: Loose Loose; Insurance companies: Win Win.
AIG has been having legal and moral problems for quite a while now. Doing a search on News.Google.Com reveals just how beset by bad actors at the very top the company has been, since 2000. Yet they pay a minimal fine, a fraction of their illicit profit, and don’t have to admit ‘wrongdoing’; effectively allowing them to avoid true accountability and permitting them to continue operating in the same immoral and illegal manner as they had before a particular legal issue hit.

What we see now developing is that we the people, who have been getting bilked by insurance companies, are having to once again cover the irresponsible behavior of bad actors.
We are having to pay to cover the unregulated Credit Default Swaps that AIG issued. Would have been cheaper to just pay back the small investors, the general public, the 97% that don’t have Millions riding in 401Ks and other similar investment instruments implemented during Reagan years, those merely trying to save enough for their retirements or their kids education, etc.
What we are being asked to fund is the horrendous contracts that were written up instead of allowing the ‘free market’ to do what it is supposed to do, hold atrocious management practices accountable.

We should have used that money to help the people, which is what tax money is supposed to do. Unfortunately, the hogs own the Animal Farm and we merely get to cower in fear or bleat like sheep, while the guard dogs run around chasing ghosts and keeping us in line.
Face it folks, the ‘free market’, much like our ‘rights’, was merely an illusion designed to obscure the fact that a few hogs intent on total control of the wealth were allowed to run loose.

BTW- did anyone read animal farm in school? Did they understand the message therein or were they merely entertained? Do you realize that it wasn’t about Russia but it could be applied to any society, including ours? Knowing that the hogs rule all, the sheep are bleating, the dogs have been loosed on us, would you merely ignore it all and go back to the well with your bucket to get water? What happens if you go to the well and the water is no longer there?

A projection I read has 8.1 million homes foreclosing by 2012. At about $290,000 per house (just over the average price of a house in the U.S.) that would be $2.349 trillion. If the u rate reached 9%, it’s projected to leave just over 1 million families homeless. If It was 1.2 million families, the cost would be $380 billion to house them all. The Feds have already loaned out over $2 trillion in unsupervised homes and the bailouts are much more than that. How many of those homes are investment property? I would say a lot because I would think that 9% (very high in the U.S.) would cause far more families going homeless if those properties were primary residence. After some states have a clause where people can give up on foreclosed property without penalty and so there is no incentive to pay the bills when things go bad. This could have been done a lot more cheaply and even ended homelessness. Instead The Democrats and the Feds want to pump money into a deep well in old debt such as the money in AIG. Obama should have brought out direct lending on day one or brought it up before election.

The “mortgage cram-down” policy of Obama’s has to end. That’s hurting the stock market and preventing lending.

In addition to the failed mortgages, which is a small amount, the fact that derivatives like CDS and CDO were leveraged up to a 40:1 ratio makes the financial liability in the Trillions. This is why the 185 billion already given to AIG is insufficient. Over Leveraging was the cause of the 1929 Crash and Depression, the Crash of 1987, and the Savings and Loan Crash in the 1980’s. This is the CAUSE of the Present Financial Depression, not the fact that a small % of real estate loans failed. Until this is presented to the Public,if it ever is, there is no solution other than letting the World Economy implode. AIG insured a large percentage of Foreign Bank Investments. Lloyds in GB is in the same predicament as AIG. There was on existing limit on leveraging, around 10%, which was raised to 40% by the Bush Congress with strong support from Henry Paulsen.

This country is apparently held hostage by the stock market. The Republicans LIKE it that way and the Democrats are too shicken-chit to do anything about it.

If we don’t give those AIG folks, them of the subprime fiasco, their millions in bonuses, who knows WHAT might happen. An economic calamity?

I’m now beginning to lean towards letting the Ma-Dickers fail. I guess it’s too late, however, we’ve already given them so much we can’t back out now. (Take names.)

It’s probably too much to ask, but the Treasury ought to ‘encourage’ AIG to set up a fund to help the homeowners they corn-holed and its ‘bonus-earners’ could ‘voluntarily’ donate their bonuses to that fund. You think?