AIG to be bailed out to the tune of $85 billion

your correct its not a bailout,its nationalization..

.it doesnt matter what you call it what it amounts to is the fed has taken on responsibility for hundreds of billions more in debt.

 

Yes, the SHAREHOLDERS have lost out. I understand this and have clearly stated that it's the little guy that loses out. Do you think the people running these banks have lost out any? No, they still have their millions and billions. Do you think anyone will be held accountable for their actions?

 

It's funny how these "privatize everything! free market!" assholes are the first ones to advocate nationalization when their cronies go under. These are the same ass clowns that wanted to privatize social security.

 

I have a funny feeling things aren't going to go according to plan

 

ya think?

 

Then you have just clearly stated that you don't understand it. Shareholders aren't little guys, they can be big institutional investors, private wealth funds, hedge funds, executives and former executives, or anybody. They lost a combined $120 billion or so. Its actually the little guy, the bank depositor, the person who insures their home, who are protected by regulators.

Yes they obviously have. Former CEO Hank Greenberg lost $3.1 billion in a single week. I'd call that 'losing out'.

I want to privatize everything (well not literally everything, but you know what I mean) and I still want to privatize social security.

Nobody is advocating nationalisation for their cronies, what is happening is that the government is stepping in to prevent a collapse of the financial system. No free marketers that I am familiar with advocate allowing a run on the banking/financial system as a free market solution. As I pointed out, the cronies are seeing their shareholdings wiped out even with government intervention. The idea that the "fat cats/tycoons/etc" are being rescued is not based on reality, which is the point I tried to make in my previous comment.

 

It's the average shareholder that is hurt from this. Duh. Not the corporations that have billions of dollars. You don't see the government bailing out people who have lost their homes to foreclosure. No, you see them bailing out the corporations, which is socialism for the rich as investor Jim Rogers has said.

Is Hank Greenberg going to be out on the street anytime soon? I doubt it.

 

Oh you mean like Yahoo??

Stocks tumble after government bailout of AIG

http://news.yahoo.com/s/ap/20080917/ap_on_bi_st_ma_re/wall_street

So anyone who uses the term "bail out" is a conspiracy theorist now, according to Pepik/Hiptastic.

 

by taking 80% stake in AIG,thus nationalizing it..
they dont have to advocate it,they have done it...

Btw,,the markets seem to understand this aint going to save anything... or have you not noticed?

 

I think the article actually says:

The stake he controls...doesn't sound like that was his personal loss. It appears he's been investigated before for fraud:

http://www.fromthewilderness.com/free/ww3/070105_target_aig.shtml

 

Why is it you freemarketeers aren't advocating allowing a run on the banking and financial system. It appears nothing is ever done by the regulators and oversight committees about any of this until the whole house of cards comes down. And then they don't hold those responsible liable for the losses. Perhaps a total collapse is what it's going to take to come up with a clean honest system. Like you say us little guys are insured for up to $100,000, so why don't we let the big guys take the fall this time?

 

Derivatives should be illegal!

http://www.projects.ex.ac.uk/RDavies/arian/scandals/derivatives.html

 

He is not free market. He favors an economy that is regulated to the benefit of the banks and corporations. He is a typical neoliberal. In other words, whatever is best for globalism is best for the people.

 

“Why is it you freemarketeers aren't advocating allowing a run on the banking and financial system”

Well the neo-liberals claimed that it wasn’t going to happen, oh any rational person who looked at what they were advocating knew it would happen at some point, but they sold the dream that it wouldn’t and that the fairytale house of straw was actually a house of brick that was immune to the huffs and puffs of a big bad wolf.

It was a money grab, wealthy classes got incredibly richer at the expense of others and as long as they bamboozled everyone into believing the dream that neo-liberalism was working to ‘free’ up economies so everyone would eventually be better off (oh it is just us super rich today but tomorrow it will be you) then everything went there way (especially the wealth).

But a big part of the confidence trick the one that convinced many that wealth and neo-liberalism were legitimate was the line that said if they did anything wrong in a deregulated world because it would be their arses on the line as well.

But the words of those that explained that this just wasn’t true and couldn’t be true were drowned out by the megaphones brought by the wealthy for their think tanks and lobbyists.

But let’s look at a certain Richard Severin Fuld, Jr. CEO of Lehman Brothers since 1994 and architect of its demise.

“Lehman Brothers Inc. Chairman and Chief Executive Richard Fuld received compensation valued at $22.1 million in 2007, a year in which the company weathered the subprime mortgage collapse better than its rivals”
http://money.cnn.com/2008/03/05/news/companies/lehman_proxy/index.htm

Well let’s say a lot of that was stock in Lehman brothers that’s not worth so much now but it also included a salary of $750,000 and a performance related bonus of roughly $4.3 million.
And “Apart from his 2007 compensation, Fuld realized about $40.3 million from exercising stock options and $26.5 million from vesting stock awards”
Oh in the summer of 2008 he did say he wouldn’t take his bonus for that year (in an effort to keep his job) but then as was commented on at the time he wasn’t (and isn’t) likely to go hungry.
Do you want to see his little house in Greenwich?
It has eighty-bedrooms and covers some 9,710-square feet in a 512,701-square-foot lot “and was purchased in 1992 for $7.3 million”.
Here you go - http://cityfile.com/dailyfile/1854
And it’s not his only place -
“In February 2007, Fuld purchased an apartment at 640 Park from the estate of the late publishing heiress Evelyn Annenberg Jaffe Hall for $21 million, although renovations of the 16-room, full-floor apartment are still believed to be underway. Then there's his vacation home in Florida—Fuld and his wife Kathy paid $13.75 million for Jupiter Island spread in 2004—and the ski house they own in Vermont.


**

 

Average shareholders like Hank, who lost $3.1 billion? You are not making any sense. All shareholders lose out, big and small.

This is such empty populist rhetoric I have to laugh. Corporations are getting wiped out right and left, you truly are clueless.

No you don't, but you do see other forms of government support for homeowners.

But if they have been bailed out, why have their owners been wiped out? You will never answer this question because you can't.

Who said he would be? Not me. The point is you are pretending the "elites" are losing nothing because the government is bailing them out, and that is total bullshit that you can only repeat but not prove.

That's funny... I never said anything about conspiracy theories. Paranoid much?

You are right, I meant to say bailing out. It has effectively been nationalised, and the shareholders are getting stuffed. And yes I noticed the markets have only got worse - did I say they wouldn't?

Not it just means he controlled it indirectly, through a company that he may not 100% own. There's no doubt he had huge losses on AIG shares.

Please try to make relevant points. I'm not here to praise Greenberg.

Why would anybody advocate that?

The big guys are taking the fall, you just refuse to accept it because its not what you want to hear.

That's ridiculous. Why not make money or banks illegal?

I am a real free marketer, you haven't even got the courage to have an opinion on anything.

 

Wow, you must have made a lot of money if you could see all that coming. I suspect, though, that you are like Rat and your indicators are always predicting doom.

Speaking of fairy tales, this is the one socialists tell their children. The rich always win, the poor always lose.

Yet what happened here? We had a property boom. Its not some tiny rich elite that owns homes, its about 69% of the population. And the fastest increase in home ownership was among minorities. So actually it was a very broad based boom in wealth.

You sound like gardener, this is just empty populism. The wealthy have taken massive hits. As I keep pointing out, the shareholders are getting obliterated in these companies. Yet there is a very deliberate effort to ignore this and moan about how the rich are getting bailed out. Why?

So what? This is just resentment. Senior executives at Lehman had huge personal investments in the company, and these investments have been wiped out. That's how it should be. But why do shareholder have a right to his personal assets in the absence of a crime? Bankruptcy is not illegal. Maybe you want to bring back debtors prisons?

 

Well the neo-liberals claimed that it wasn’t going to happen, oh any rational person who looked at what they were advocating knew it would happen at some point, but they sold the dream that it wouldn’t and that the fairytale house of straw was actually a house of brick that was immune to the huffs and puffs of a big bad wolf.


Wow, you must have made a lot of money if you could see all that coming.

I haven’t lost any; well before the credit crunch we had cleared our debts and re-negotiated our mortgage. We are not fireproof but we were a little more prepared.

A large number of people predicted that deregulation etc was having a detrimental effect on the whole system and that it was involved in practices that could bring about the situation we are in now.

I suspect, though, that you are like Rat and your indicators are always predicting doom.

Clever man, LOL, try and paint me as Rat, get me all hot and bothered, shake my concentration.

**

Quote:
It was a money grab, wealthy classes got incredibly richer at the expense of others and as long as they bamboozled everyone into believing the dream that neo-liberalism was working to ‘free’ up economies so everyone would eventually be better off (oh it is just us super rich today but tomorrow it will be you) then everything went there way (especially the wealth).


Speaking of fairy tales, this is the one socialists tell their children. The rich always win, the poor always lose.

I’m sure I’m not the only one that noticed that you don’t actually dispute it.

Try reading A Brief History of Neoliberalism by David Harvey


Yet what happened here? We had a property boom. Its not some tiny rich elite that owns homes, its about 69% of the population. And the fastest increase in home ownership was among minorities. So actually it was a very broad based boom in wealth.

Not a great comfort to the sub-primers that are now losing those houses and the one that used the houses as collateral on debt.

Many normal Americans have been running on empty in 2005 -6 the US commerce department reported that the after tax personal savings rate had been in the negative.

Many average Americans no raft to which to ride out bad times.

**

Quote:
But a big part of the confidence trick the one that convinced many that wealth and neo-liberalism were legitimate was the line that said if they did anything wrong in a deregulated world because it would be their arses on the line as well. But the words of those that explained that this just wasn’t true and couldn’t be true were drowned out by the megaphones brought by the wealthy for their think tanks and lobbyists.


You sound like gardener, this is just empty populism. The wealthy have taken massive hits. As I keep pointing out, the shareholders are getting obliterated in these companies. Yet there is a very deliberate effort to ignore this and moan about how the rich are getting bailed out. Why?

Lets see, supposedly in the 1950-60’s the top executives of large US companies were earning about 40-50 times more than the average worker, by the 2000’s that figure was up to around 400 times.

Oh many will have taken a hit but most will have not just a raft but a yacht on which to ride out bad times.

Just like Richard Fuld

**

Quote:
But let’s look at a certain Richard Severin Fuld, Jr. CEO of Lehman Brothers since 1994 and architect of its demise.


So what? This is just resentment. Senior executives at Lehman had huge personal investments in the company, and these investments have been wiped out. That's how it should be. But why do shareholder have a right to his personal assets in the absence of a crime? Bankruptcy is not illegal. Maybe you want to bring back debtors prisons?

Not resentment, just an example to back up what I’ve been explaining, an argument I’ve noticed that you clearly don’t like but don’t seem able to actually dispute.

And I actually pointed out that his Lehman stock was probably not worth much now but he has been CEO for 14 years (on a last reported salary of 750,000 dollars) and just in 2007 got a “a $4.3 million cash bonus” and the Fuld’s do have that nice property portfolio to comfort them.

 

Its just that... you know, a lot of people assure me that they saw everything coming. Considering that such foresight can make a millionaire out of you, I was curious if you acted on it. I ran a survey here about where people thought the economy, the dollar, the markets etc were headed, who would get elected and so on - it seemed like the people who were always claiming to have predicted everything were the ones who absolutely refused to participate.

I'm sure it came across that way but it was an honest question. You are deeply suspicious of free market capitalism and seem to believe that it cannot work. So if your indicators are always pointing at doom, well broken clocks are right twice a day right?

I do dispute it, that's why I pointed out that there was a property bubble that more than two thirds of the country participated in. This was not restricted to the super rich, as you made it out to be.

This is a not-so-subtle change of argument - I never said nobody has been hurt by this. The subprimers benefitted on the way up, and got hurt on the way down - the same as "the rich".

And?

Like all countries in the world at all times in history, some people are poor. And?

Yes, executive salaries have gone up a lot. But that's private corporations paying private individuals based on private agreements. Isn't it the shareholders' responsibility to pay executives properly? After all, its their money. I don't see a role for government here.

What's to dispute? Have I denied Fuld is rich? No. What I said was that Fuld paid a huge price for the collapse of Lehman - I never said he was left penniless. Your argument, you might recall, is that these rich executives expect the government to bail them out, that they don't believe in the free market when it come to their own wealth. But the free market wiped out the value of shareholdings in Lehman - including Fuld's shares.

Again - this is a straw man. I never suggested Fuld was destitute. I said that shareholders in these companies have not been bailed out, they have been wiped out. By the free market. So I'm questioning the populist version of history where the rich were rescued by the government and the poor were left to suffer.

 

Quote:
Originally Posted by balbus
I haven’t lost any; well before the credit crunch we had cleared our debts and re-negotiated our mortgage. We are not fireproof but we were a little more prepared.

A large number of people predicted that deregulation etc was having a detrimental effect on the whole system and that it was involved in practices that could bring about the situation we are in now.


Its just that... you know, a lot of people assure me that they saw everything coming. Considering that such foresight can make a millionaire out of you, I was curious if you acted on it. I ran a survey here about where people thought the economy, the dollar, the markets etc were headed, who would get elected and so on - it seemed like the people who were always claiming to have predicted everything were the ones who absolutely refused to participate.

Oh pleeeeeeeease

Any intelligent person and you’re not dumb now there is a world of difference between making a solid prediction on how much the dollar will be in one five or ten years hence or who would be president 2008 or 2013 and a serious analyse that comes to the conclusion that the a system is venerable to stumbling or collapsing.

The former is the realm of a country fair guess the weight of a pig side show and the latter the province of academia.

I had no crystal ball but I did decide to sell a property in early 2007 rather than hold on to it for another year and the money raised we decided to cleared our debts and rearrange our mortgage.

**

Quote:
Originally Posted by balbus
I’m sure I’m not the only one that noticed that you don’t actually dispute it.


I do dispute it, that's why I pointed out that there was a property bubble that more than two thirds of the country participated in. This was not restricted to the super rich, as you made it out to be.

I didn’t say it was restricted to the rich I said the wealthy classes got incredibly richer at the expense of others, my point was that it was not evenly distributed it favoured the rich, the tax cuts favoured the rich, the increases in executive pay and bonuses favoured the rich, the deregulated system favoured the rich, it was a money grab.

“Thomas Piketty, of the École Normale Supérieure in Paris, and Emmanuel Saez of the University of California at Berkeley recently updated their groundbreaking study on income inequality (pdf), and their findings are striking.
The new figures show that from 2003 to 2004, the latest year for which there is data, the richest Americans pulled far ahead of everyone else. In the space of that one year, real average income for the top 1 percent of households — those making more than $315,000 in 2004 — grew by nearly 17 percent. For the remaining 99 percent, the average gain was less than 3 percent, and that probably makes things look better than they really are, since other data, most notably from the Census Bureau, indicate that the average is bolstered by large gains among the top 20 percent of households. In all, the top 1 percent of households enjoyed 36 percent of all income gains in 2004, on top of an already stunning 30 percent in 2003”
http://www.demos-usa.org

And remember that there have been more tax cuts (which favour the rich) since 2004.

**

Quote:
Originally Posted by balbus
Not a great comfort to the sub-primers that are now losing those houses and the one that used the houses as collateral on debt.


This is a not-so-subtle change of argument - I never said nobody has been hurt by this. The subprimers benefitted on the way up, and got hurt on the way down - the same as "the rich".

Not the same as the rich because the rich can more easily weather an economic storm and most of the rich know that. The promoters of the neo-liberal idea were promising uninterrupted prosperity for all, which many analysts and economists thought was wrong but those voices of warning were drowned out by the neoliberal mantras. Remember the urging to go out and spend the US out of economic trouble, it was an urge to gamble that the debts could be paid off one day.

**

Quote:
Originally Posted by balbus
And I actually pointed out that his Lehman stock was probably not worth much now but he has been CEO for 14 years (on a last reported salary of 750,000 dollars) and just in 2007 got a “a $4.3 million cash bonus” and the Fuld’s do have that nice property portfolio to comfort them.


Again - this is a straw man. I never suggested Fuld was destitute. I said that shareholders in these companies have not been bailed out, they have been wiped out. By the free market. So I'm questioning the populist version of history where the rich were rescued by the government and the poor were left to suffer.

But you admit most of them haven’t been wiped out many have taken a hit but they are cushioned to the extent that such hits don’t hurt as much as those that have no cushion.

The thing is that the government has had to step in to try and hold up a tottering system that the neo-liberals said wouldn’t totter.

To me there clearly seems to be a difference in mentality here, hipstatic doesn’t seem to care about bringing about a better society or give a fuck about what can happen to many people when a bad system fails. He just shrugs his shoulders steps over the bodies and moves on without a thought. I mean his comments on the less fortunate seem to me reminiscent of the empathy and understanding shown by Marie-Antoinette to the plight of the less fortunate in pre-revolutionary France.

 

I don't think we can pretend any longer that Wall Street is about investment. Investment in what? Money and value on Wall Street is now nothing more than undercapitalized speculation and trading. With all the instruments now being used in the markets, and the fact that the US now produces actually little in the way of tangible goods. Just what is it we are investing in? Promises of wealth? Well it would seem those are empty promises for most of us.

I think the fact that he was investigated in 2005 for just the sort of market manipulation that lead to this crash is very relevant.

Free Market, it definitely appears to be free for those allowed to trade without adequate capitalization to back their trades and allowed to manipulate share through shorting and other instruments.