AIG Is Thinking About Suing the Government for Bailing It Out

[ryoder 1,590]

http://www.theatlanticwire.com/business/2013/01/aig-thinking-about-suing-government-bailing-it-out/60698/

[facepalm]

"There are only three things of value: younger women, faster airplanes, and bigger crocodiles" - Arthur Jones.

[lawrocket 3]

How is this any different from a borrower suing a lender? What if AIG is correct that the government's bailout amounted to usury?

My wife is hotter than your wife.

[Southern_Man 0]

Should have let them go under.

"What if there were no hypothetical questions?"

[lawrocket 3]

I don’t think that, from a legal standpoint, the case is “unmerited.” The government told AIG it could either go bankrupt or take the loan at 14.5% interest.

I read something:

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"If AIG enters this suit it would be the equivalent of a patient suing their doctor for saving their life," said Mark Williams, a former Federal Reserve bank examiner who teaches in the finance department at Boston University.

Yes. It would be. And we all know that if a doctor is going to save your life (“Thank you, doctor, for removing the intestinal blockage”) that the doctor is entitled to paralyze you from the waist down.

“But doctor, you left her permanently disabled.”
“I saved her life. So I left her life that much more difficult. At least she HAS a life.”

It doesn’t work that way. Loan sharks say, “He needed money. I gave it to him. He’d have been insolvent if not for me.” Check out Pay Day Lenders – generally considered a scourge keeping people in long-term debt.

I guess it turns out that charging high interest is a fine thing so long as the government is doing it, and doing it to people or organizations considered less than worthy.

My wife is hotter than your wife.

[weekender 0]

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Should have let them go under.

When Enron went under it was the largest corporate bankruptcy in history.

They didn't receive one shred of help from the fed.

We have this wonderful cleansing mechanism in a free market economy. It's called 'going out of business.'

Enron was not an insurance company that, for lack of a better term, insured our banking industry. If AIG failed, then US banking system would have failed. Enron was mostly a real time electric and derivative trading company. The repercussions of Enron failing were tiny in comparison. Not apples to apples.

I am not saying the bailout was good or bad. My point is that you need to find an apt comparison if you are going to make that argument. Enron vs AIG is not.

"The point is, I'm weird, but I never felt weird."
John Frusciante

[weekender 0]

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How is this any different from a borrower suing a lender? What if AIG is correct that the government's bailout amounted to usury?

I'm with you. the lawsuit is brought by Hank Greenberg. He is bearing all the cost. AIG might attach themselves soley as a hedge in case the gov't pays out. They might not too, the decision has not been made. i personally find it in bad taste but im not a corporate lawyer or even a C level executive but i do understand why they might do it.

"The point is, I'm weird, but I never felt weird."
John Frusciante

[GeorgiaDon 379]

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i personally find it in bad taste but im not a corporate lawyer or even a C level executive but i do understand why they might do it.

This sort of begs the question, is there any such a thing as corporate morality other than "do whatever is legal to make a dollar" in your experience? Is "gratitude for saving their ass" not fungible and therefor not part of the thinking? I ask because in normal human interactions there are lots of things one just doesn't do, even though there is not a specific law against them, because to do them makes things like trust, respect, etc impossible. It would be impossible to have anything like a human interaction with a person whose only value is to do whatever profits themselves, without any regard for the impact on other people, as long as their lawyers can keep them out of jail. Of course we are talking about corporations not individuals, but corporate decisions are made by real people; if they are willing to be total pricks in business, are they not likely to be total pricks as people too?

Don

_____________________________________
Tolerance is the cost we must pay for our adventure in liberty. (Dworkin, 1996)
“Education is not filling a bucket, but lighting a fire.” (Yeats)

[weekender 0]

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i personally find it in bad taste but im not a corporate lawyer or even a C level executive but i do understand why they might do it.

This sort of begs the question, is there any such a thing as corporate morality other than "do whatever is legal to make a dollar" in your experience? Is "gratitude for saving their ass" not fungible and therefor not part of the thinking? I ask because in normal human interactions there are lots of things one just doesn't do, even though there is not a specific law against them, because to do them makes things like trust, respect, etc impossible. It would be impossible to have anything like a human interaction with a person whose only value is to do whatever profits themselves, without any regard for the impact on other people, as long as their lawyers can keep them out of jail. Of course we are talking about corporations not individuals, but corporate decisions are made by real people; if they are willing to be total pricks in business, are they not likely to be total pricks as people too?

Don

Here is what someone smarter than me said when i mentioned it was tacky. they are in a catch 22. they know the US bailed them out and are running add's to thank them. But they will be sued by there own shareholders if Hank G wins this suit. They answer to their shareholders and will not be able to avoid a suit if money is handed to Hank G and his company. Dann if they do and damned if they dont. They are meeting today around 8pm and will make a decision. the fact that they are holding such high profile meetings shows their are not just "pricks" looking for a quick buck. They are trying to avoid damages from a shareholder lawsuit. damages that will hurt all shareholders.

I find business in the real world is a lot more complicated than described on this board. i also find it a lot less evil than people here find. guess im dumb and evil, hah

"The point is, I'm weird, but I never felt weird."
John Frusciante

[wmw999 2,550]

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find business in the real world is a lot more complicated than described on this board. i also find it a lot less evil than people here find.

What -- things aren't just black and white, and real world situations are more complex than they appear??? Say it ain't so!

If most people with strong opinions on issues were to be thoroughly educated on those issues they might find that their opinions become a whole lot less black-and-white.

Wendy P.

There is nothing more dangerous than breaking a basic safety rule and getting away with it. It removes fear of the consequences and builds false confidence. (tbrown)

[DiverMike 5]

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things aren't just black and white, and real world situations are more complex than they appear??? Say it ain't so!

And all women engineers are not fat and ugly? Say it ain't so!

For the same reason I jump off a perfectly good diving board.

[weekender 0]

AIG has announced they will not be joining the suit.

"The point is, I'm weird, but I never felt weird."
John Frusciante

[OHCHUTE 0]

Corporate lawyers are more crafty than government lawyers so it's only natural lawsuits would be filed. First the suit, then the settlement, then the commission checks. Lawyers have to eat too!

Bankers are the reason.

[weekender 0]

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Corporate lawyers are more crafty than government lawyers so it's only natural lawsuits would be filed. First the suit, then the settlement, then the commission checks. Lawyers have to eat too!

Bankers are the reason.

Lawsuits are filed all day everyday. the topic is AIG considering joining a lawsuit brought by another party. They have decided to not join.

Bankers are the reason for what? the reason your company could make payroll? the reason you are able to drive over bridges and through tunnels, fly into airports in airplanes, have clean water and not have sewer water in your street, have a stable food supply, medicine.... i assume that is what you meant. Bankers are evil and all those things brought to you from them should be outlawed.

"The point is, I'm weird, but I never felt weird."
John Frusciante

[GeorgiaDon 379]

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Here is what someone smarter than me said when i mentioned it was tacky. they are in a catch 22. they know the US bailed them out and are running add's to thank them. But they will be sued by there own shareholders if Hank G wins this suit. They answer to their shareholders and will not be able to avoid a suit if money is handed to Hank G and his company. Dann if they do and damned if they dont.

Thanks for your comments, they do help me to understand what is at stake for AIG a lot better. I'm glad they decided not to join the suit, and hope they don't suffer repercussions from their shareholders because of that.

Your comment also prompts me to think about other aspects of corporate behavior and how that has changed (or at least is generally perceived to have changed) over the years. For example, I have the impression that it was more common for corporations to support philanthropic causes in the past. I wonder if this has anything to do with the general erosion of "sense of community" in modern society, so shareholders are less likely to approve of activities that don't improve their own bottom line. Being a shareholder makes you kind of anonymous, in that you are just one of many, and the company will take the "blame", so people are shielded from criticism when they force companies to disengage from community-minded activities. In times past people more-or-less accepted that if they were doing well they had an obligation to "give back", but that seems to be a quaint anachronism these days.

Don

_____________________________________
Tolerance is the cost we must pay for our adventure in liberty. (Dworkin, 1996)
“Education is not filling a bucket, but lighting a fire.” (Yeats)

[weekender 0]

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Here is what someone smarter than me said when i mentioned it was tacky. they are in a catch 22. they know the US bailed them out and are running add's to thank them. But they will be sued by there own shareholders if Hank G wins this suit. They answer to their shareholders and will not be able to avoid a suit if money is handed to Hank G and his company. Dann if they do and damned if they dont.

Thanks for your comments, they do help me to understand what is at stake for AIG a lot better. I'm glad they decided not to join the suit, and hope they don't suffer repercussions from their shareholders because of that.

Your comment also prompts me to think about other aspects of corporate behavior and how that has changed (or at least is generally perceived to have changed) over the years. For example, I have the impression that it was more common for corporations to support philanthropic causes in the past. I wonder if this has anything to do with the general erosion of "sense of community" in modern society, so shareholders are less likely to approve of activities that don't improve their own bottom line. Being a shareholder makes you kind of anonymous, in that you are just one of many, and the company will take the "blame", so people are shielded from criticism when they force companies to disengage from community-minded activities. In times past people more-or-less accepted that if they were doing well they had an obligation to "give back", but that seems to be a quaint anachronism these days.

Don

i can only speak from my experience. small firms encourage public service. for example, im a volunteer firefighter and have always been given time off for training as long as its reasonable and requested in advance. when i worked at large firms it was mandatory. they had so many days you had to do something charitable and prove it. for example, when i worked at GSCO they actually picked you up at the office and drove you to Habitat for Humanity work site. Also, partners were required to donate a % of their bonuses to charity. People seeking partnership had to have a record of it before even being considered.

this is the only job i have ever had so my experience is limited on this topic. i dont know about the impression nor care. i dont see anything different today except people have less money to donate. so i dont see anything different from the good old days.

"The point is, I'm weird, but I never felt weird."
John Frusciante

[OHCHUTE 0]

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Corporate lawyers are more crafty than government lawyers so it's only natural lawsuits would be filed. First the suit, then the settlement, then the commission checks. Lawyers have to eat too!

Bankers are the reason.

Lawsuits are filed all day everyday. the topic is AIG considering joining a lawsuit brought by another party. They have decided to not join.

Bankers are the reason for what? the reason your company could make payroll? the reason you are able to drive over bridges and through tunnels, fly into airports in airplanes, have clean water and not have sewer water in your street, have a stable food supply, medicine.... i assume that is what you meant. Bankers are evil and all those things brought to you from them should be outlawed.

I speak about the Wall Street bankers and those who participated in what basically amounted to stealing money from our Treasury. Rating Junk to AAA by S&P employees who were in cahoots with insureres to sell bogus paper later called toxic debt which BTW has been conveniently swept under the carpet all while receiving BONUS money from your tax dollars.

Yes I'm jealeous I don't have a coffee shop in Brazil due to receiving 4million dollar commission check for what amounted to FRAUD. But FRAUD is legal in Wall Street circles hidden by investments YOU DON"T UNDERSTAND.

Please tell me where I can sign up to be one of your BANKERS and I'll gladly join the country club of the elite who are exempt from laws as they have their own laws and rules to protect what they do.

Go do a ponzi like they did and see where it gets you.

[lawrocket 3]

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in what basically amounted to stealing money from our Treasury

Seems the Treasury was - and has been quite willing to give this money out. It's what happens when you play with taxpayer money instead of your own.

My wife is hotter than your wife.

[weekender 0]

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Quote

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Corporate lawyers are more crafty than government lawyers so it's only natural lawsuits would be filed. First the suit, then the settlement, then the commission checks. Lawyers have to eat too!

Bankers are the reason.

Lawsuits are filed all day everyday. the topic is AIG considering joining a lawsuit brought by another party. They have decided to not join.

Bankers are the reason for what? the reason your company could make payroll? the reason you are able to drive over bridges and through tunnels, fly into airports in airplanes, have clean water and not have sewer water in your street, have a stable food supply, medicine.... i assume that is what you meant. Bankers are evil and all those things brought to you from them should be outlawed.

I speak about the Wall Street bankers and those who participated in what basically amounted to stealing money from our Treasury. Rating Junk to AAA by S&P employees who were in cahoots with insureres to sell bogus paper later called toxic debt which BTW has been conveniently swept under the carpet all while receiving BONUS money from your tax dollars.

Yes I'm jealeous I don't have a coffee shop in Brazil due to receiving 4million dollar commission check for what amounted to FRAUD. But FRAUD is legal in Wall Street circles hidden by investments YOU DON"T UNDERSTAND.

Please tell me where I can sign up to be one of your BANKERS and I'll gladly join the country club of the elite who are exempt from laws as they have their own laws and rules to protect what they do.

Go do a ponzi like they did and see where it gets you.

you can apply for a job at any bank and at any time if you would like. they have websites and the app process is very clear. i am shocked someone who understand finance as well as you didnt know that.

you can also get a huge check from the gov't by exposing people who commit bank fraud. so by all means, do that too. i would be curious who these people are who committed fraud and were not convicted but also were given 4mill and now own a coffee shop in Brazil. i do not know anyone like that because they do not exist in my world. the real world. i wish i lived in your cartoon world, it seems so much easier than mine. i love coffee and 4 million dollars.

"The point is, I'm weird, but I never felt weird."
John Frusciante

[OHCHUTE 0]

So you are a wall street banker? It's been soooooo reported when the financial crisis hit, all the wallstreeters leaving wall st with their huge commission paychecks, paid for by you and me via taxes, and opening up shops in Brazil to have a good time. Sorry but you just can't apply for the type of cozey jobs these guys had on wall street that were TOTALLY EXEMPT from criminal prosecution. LIKE THEY DIDN"T KNOW THEY WERE PARTICIPATING IN A BANK RUN PONSI SCHEME via all the worlds banks where sales guys were eager for commissions for selling worthless paper. You are not that neive are you? Now there's a new crop dealing in college debt securities which will blow up once people stop paying their college loans. These guys have licenses to steal and Goldman and Gore took the gov't to the cleaners with their investments in alturnative energy that failed, yet they profited. Show me where to sign up and its not on a BOA employment web site. Have the gov't coffers in your pocket and you get immediate membership status to the riches bunch of guys on the planet. They were all over there in Caymans last month having a party for year end celebration and there was hardly enough room to park all the private jets.

[weekender 0]

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So you are a wall street banker? It's been soooooo reported when the financial crisis hit, all the wallstreeters leaving wall st with their huge commission paychecks, paid for by you and me via taxes, and opening up shops in Brazil to have a good time. Sorry but you just can't apply for the type of cozey jobs these guys had on wall street that were TOTALLY EXEMPT from criminal prosecution. LIKE THEY DIDN"T KNOW THEY WERE PARTICIPATING IN A BANK RUN PONSI SCHEME via all the worlds banks where sales guys were eager for commissions for selling worthless paper. You are not that neive are you? Now there's a new crop dealing in college debt securities which will blow up once people stop paying their college loans. These guys have licenses to steal and Goldman and Gore took the gov't to the cleaners with their investments in alturnative energy that failed, yet they profited. Show me where to sign up and its not on a BOA employment web site. Have the gov't coffers in your pocket and you get immediate membership status to the riches bunch of guys on the planet. They were all over there in Caymans last month having a party for year end celebration and there was hardly enough room to park all the private jets.

your post makes no sense to me. it seems to be long anger and short reason. perhaps its because of my 20 yrs experience in the business and actual knowledge on the subject that your post sounds childish and paranoid. Or perhaps I'm a moron who does not understand the banking industry, the law and world bank domination. i suppose, as you said, i'm "neive".

"The point is, I'm weird, but I never felt weird."
John Frusciante

[OHCHUTE 0]

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your post makes no sense to me. it seems to be long anger and short reason. perhaps its because of my 20 yrs experience in the business and actual knowledge on the subject that your post sounds childish and paranoid. Or perhaps I'm a moron who does not understand the banking industry, the law and world bank domination. i suppose, as you said, i'm "neive".

Funny, so many English Teachers here that when they don't have an argument they resort to attacking your typing.

Lets do the English first:


na·ive
[nah-eev] Show IPA

adjective
1.
having or showing unaffected simplicity of nature or absence of artificiality; unsophisticated; ingenuous.

2.
having or showing a lack of experience, judgment, or information; credulous: She's so naive she believes everything she reads. He has a very naive attitude toward politics.

3.
having or marked by a simple, unaffectedly direct style reflecting little or no formal training or technique: valuable naive 19th-century American portrait paintings.

4.
not having previously been the subject of a scientific experiment, as an animal.

So now that we know you have banking experience please tell us exactly how the sales guys at Standand and Poor rated the junk paper to AAA status so that the paper would be attractive to sell, so much so, they were having a hard time fueling the front end paper scam even by having people who didn't have a dime, apply for mortgage loans.
I take it you never got your coffee shop the reason you're a tad huffy. And not a member of the club!
I know business and there's a double standard.

Sorry for any grammer or misspellings--not the point of what I'm discussing.

[weekender 0]

>OHCHUTE wrote "So now that we know you have banking experience please tell us exactly how the sales guys at Standand and Poor rated the junk paper to AAA status so that the paper would be attractive to sell, so much so, they were having a hard time fueling the front end paper scam even by having people who didn't have a dime, apply for mortgage loans.
I take it you never got your coffee shop the reason you're a tad huffy. And not a member of the club!
I know business and there's a double standard."
_________________________________________________
i cannot respond because your post makes no sense to me. S&P's salesmen do not give ratings. i have no idea what a "front end paper" is. S&P has nothing to do with mortgage sales as you seem to imply. You seem to have heard a lot of names and terms you do not understand and attempted to put them in sentences to make an argument. you failed. You should not argue finance. you have no understanding of it.

pause for a moment and ask yourself. who is mostly likely naive about finance here? the guy who openly admitted to working in banking for 20 years or you? The guy who has openly admitted to working at GSCO and other IB's or you? I suppose it could me but doubt it.

save face and pretend you have to go jumping or something.

"The point is, I'm weird, but I never felt weird."
John Frusciante

[OHCHUTE 0]

Weekender, there are sales guys at Standard and Poor. They sell a service right? Now the sales guys at S&P might not have been the ones applying the bogus ratings, but S&P employees fraudulently gave high ratings to paper that was junk, so that sales guys at banks could sell paper based on the attractiveness of the rating. By you saying you don't know what the front end paper is, in the giant banking scheme that involved bogus mortgage paper being pulled into mortgage back securities and were insured of default tells me you really don't have a clue what happened to this country. And you work in banking?

It was a ponzi scheme predicated on fake loans, pooled, sold and then insured against failure. It failed when buyers left and Lehman was stuck with the bag of worthless paper. AND THE BANKERS< YOU, DIDN"T KNOW ANYTHING ABOUT THE BUSINESS YOU WERE IN.

So tell me all about commissions earned off of selling investments. Here bankie, buy this lot of AAA paper for 1 billion. And OH, it's insured never to fail and you'll earn 10%APR.... Funny how AIG and Lehman we're the ones left with the trash. And even those guys got there commission checks.

[weekender 0]

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Weekender, there are sales guys at Standard and Poor. They sell a service right? Now the sales guys at S&P might not have been the ones applying the bogus ratings, but S&P employees fraudulently gave high ratings to paper that was junk, so that sales guys at banks could sell paper based on the attractiveness of the rating. By you saying you don't know what the front end paper is, in the giant banking scheme that involved bogus mortgage paper being pulled into mortgage back securities and were insured of default tells me you really don't have a clue what happened to this country. And you work in banking?

It was a ponzi scheme predicated on fake loans, pooled, sold and then insured against failure. It failed when buyers left and Lehman was stuck with the bag of worthless paper. AND THE BANKERS< YOU, DIDN"T KNOW ANYTHING ABOUT THE BUSINESS YOU WERE IN.

So tell me all about commissions earned off of selling investments. Here bankie, buy this lot of AAA paper for 1 billion. And OH, it's insured never to fail and you'll earn 10%APR.... Funny how AIG and Lehman we're the ones left with the trash. And even those guys got there commission checks.

Your post makes no sense to me. I'm sorry, perhaps you know something i do not. I suppose its possible you know more about banking than me. if i had to guess, based on your fictional term, "front end paper" i'm not the one who is lacking knowledge on what happened to this country.

I am at a huge disadvantage in this discussion because i am saddled with the burden of knowledge on the topic. you on the other hand, can make up terms and theories and expect me to make a coherent response to them. its just not possible. i only respond to people like you for the edification of other readers. so they see how clueless people like you are in finance and do not repeat your comments. i dont want them to feel as embarrassed as you should be right now

"The point is, I'm weird, but I never felt weird."
John Frusciante

[jakee 1,564]

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Bankers are the reason for what? the reason your company could make payroll? the reason you are able to drive over bridges and through tunnels, fly into airports in airplanes, have clean water and not have sewer water in your street, have a stable food supply, medicine.... i assume that is what you meant. Bankers are evil and all those things brought to you from them should be outlawed.

So because banks provide essential financial services then the way banks do business is therefore above reproach? Nonsense.

Doctors provide essential services that you'd miss if they were gone... but if a doctor turned up to surgery smashed off his tits and amputated your leg instead of removing your appendix then you'd sue the fuck out of him and everyone else in the hospital who let it happen.

Do you want to have an ideagasm?