AIG Rescued for the Fourth Time
March 1, 2009 by Stephen Kersey
Filed under Business
American International Group Inc., commonly known as AIG, is getting assisted from the United States federal government for the fourth time. This rescue calls for the government to hand over as much as $30 billion.
AIG Building - Image: Flickr
Once one of the largest and most powerful companies in the world, AIG has been tortured by the recent economic troubles in the United States. Not long ago, AIG was the largest insurance provider on the planet. Now, the company would cease to exist if it weren’t for the multiple federal bailouts.
On Monday, AIG is expected to announce to shareholders that the company lost more than $50 billion in latest quarter. With the company’s stock price already worth less than a dollar, this is just the next verse in a long line of bad news.
The previous three capital assistance efforts by the federal government totaled approximately $150 billion. As a result, it is estimated that the United States now owns 80% of AIG. Due to the size of the company, most economic experts say that the country simply cannot afford to let AIG totally fail. Not only would it cause much anguish domestically, it would have an extremely negative global impact.
Although AIG primarily deals in insurances, they also dabbled in industries that have been hammered by the housing crisis. That aspect of the company is blamed most as the main reason why AIG is currently in shambles.
Source: Wire Reports
