This has to be the biggest ponzi scheme that has ever been perpetrated on the American public. The original $49.5 billion had 100% of AIG as collateral, that same collateral was on four more occasions to the point of AIG now owing over $ 182.5 billion. This was a public company traded on the NY Stock Exchange with some ( as I recall ) 44 million shares outstanding and a market cap of over $ 90 billion. In January 2008, those shares were trading at about a $ 1 which subsequently had AIG do a 1 to 20 split, thereby bringing the so called value of those shares to be traded at over $ 20 in order to vacate the possibility of de-listing. The shares have risen, to about $ 40, yet the true value continues to be $ 2 range. Then our Government does this smoke and mirrors routine of accepting preferred shares, then crossing them into common shares with 1,6 billion to be offered. This is the basis of having the taxpayers “paid off”. They anticipate selling those shares at some $ 30 or more, so in the end, my question is simply:
WHO THE HELL WANTS TO BUY THESE, WHEN THEY ARE WORTH NICKELS?
This is simply smoke and mirrors, and has been from day one.
Yeah i can hear it now, but I called their demise in writing a year before it occurred.
I trust Turbo Tax Tim 100%, don’t you? I am sure he has the taxpayers in mind with all these games. Even more amazing is AM Best awarding them an “A” rating when they owe so many billions to us. Perhaps the Chosen One ordered Best to give them this rating to make himself look better.
So what is the difference if the government sells 1.6B shares at $30 vs 32B shares at $1.50? Either way the dollar amount is the same. It’s not smoke and mirrors. What they did was improve the stock price by consolidating shares, nothing that isn’t common in the stock market. Even if the shares didn’t do the reverse split they’d be trading at $2.70, which is 270% more than what they were trading at 16 months ago.
No one is happy about the fact that the Government bailed out AIG, what seems more alarming is the fact that no one is happy that AIG is going to pay back the amount they were given. Show me the facts that the tax payers are losing money…
Smoke, Every article I have read on AIG and their plans have not come up with a scenario where the taxpayers and stockholders would recoup their money fully after this monstrous bailout. The best analysis says that after the dust clears, they will still owe between $50 & $60 Bil. They have been trying to sell off units of the company and several deals have fallen through. Perhaps buyers are wary about the assets being offered. Perhaps they are wary of Turbo Tax Tim, with good reason.
The events at AIG are all smoke and mirrors….the company did a reverse stock split to keep the company from being delisted. The stock at $50 a share at the reverse split would be at most $2.50, but it is probably worth pennies on the dollar. The American taxpayer got taken to the cleaners on this deal. While TARP was necessary, the example of AIG shows that the money was grossly mismanaged.
With the company planning a stock sale in 2011, the company still faces tremendous obstacles that should make tremendous investors extremely nervous:
a) the company has sold off some of their most valuable business units such as Hartford Steam Boiler, Transamerica Re, Asian life insurance operations, etc that would not allow it to optimize value for future stockholders
b) the company has seen a tremendous loss of key personnel that have joined competitors
c) key business units such as Chartis will lose revenue as they are forced to shed business that they have underpriced for years (or dramtically raise rates on their policyholders)
All in all this has been a bad deal for the American taxpayer and will be for any stockholder who would buy the stock when the government begins to sell its stake.
Darth, I think you hit the nail on the head about this outlaw company. They got away with a lot in the past 20 years and it caught up with them. Their hands were very dirty. Remember they were one of the companies in bed with Marsh Mc on the bid rigging schemes of some years ago. That was small potatos compared to the credit swaps they were doing. Many Americans don’t realize that much of the bailout money given went to re-imburse foreign banks who bought into this Ponzi scheme. How do the taxpayers get that money back? The short answer is “They don’t”.
This has to be the biggest ponzi scheme that has ever been perpetrated on the American public. The original $49.5 billion had 100% of AIG as collateral, that same collateral was on four more occasions to the point of AIG now owing over $ 182.5 billion. This was a public company traded on the NY Stock Exchange with some ( as I recall ) 44 million shares outstanding and a market cap of over $ 90 billion. In January 2008, those shares were trading at about a $ 1 which subsequently had AIG do a 1 to 20 split, thereby bringing the so called value of those shares to be traded at over $ 20 in order to vacate the possibility of de-listing. The shares have risen, to about $ 40, yet the true value continues to be $ 2 range. Then our Government does this smoke and mirrors routine of accepting preferred shares, then crossing them into common shares with 1,6 billion to be offered. This is the basis of having the taxpayers “paid off”. They anticipate selling those shares at some $ 30 or more, so in the end, my question is simply:
WHO THE HELL WANTS TO BUY THESE, WHEN THEY ARE WORTH NICKELS?
This is simply smoke and mirrors, and has been from day one.
Yeah i can hear it now, but I called their demise in writing a year before it occurred.
I trust Turbo Tax Tim 100%, don’t you? I am sure he has the taxpayers in mind with all these games. Even more amazing is AM Best awarding them an “A” rating when they owe so many billions to us. Perhaps the Chosen One ordered Best to give them this rating to make himself look better.
So what is the difference if the government sells 1.6B shares at $30 vs 32B shares at $1.50? Either way the dollar amount is the same. It’s not smoke and mirrors. What they did was improve the stock price by consolidating shares, nothing that isn’t common in the stock market. Even if the shares didn’t do the reverse split they’d be trading at $2.70, which is 270% more than what they were trading at 16 months ago.
No one is happy about the fact that the Government bailed out AIG, what seems more alarming is the fact that no one is happy that AIG is going to pay back the amount they were given. Show me the facts that the tax payers are losing money…
Smoke, Every article I have read on AIG and their plans have not come up with a scenario where the taxpayers and stockholders would recoup their money fully after this monstrous bailout. The best analysis says that after the dust clears, they will still owe between $50 & $60 Bil. They have been trying to sell off units of the company and several deals have fallen through. Perhaps buyers are wary about the assets being offered. Perhaps they are wary of Turbo Tax Tim, with good reason.
The events at AIG are all smoke and mirrors….the company did a reverse stock split to keep the company from being delisted. The stock at $50 a share at the reverse split would be at most $2.50, but it is probably worth pennies on the dollar. The American taxpayer got taken to the cleaners on this deal. While TARP was necessary, the example of AIG shows that the money was grossly mismanaged.
With the company planning a stock sale in 2011, the company still faces tremendous obstacles that should make tremendous investors extremely nervous:
a) the company has sold off some of their most valuable business units such as Hartford Steam Boiler, Transamerica Re, Asian life insurance operations, etc that would not allow it to optimize value for future stockholders
b) the company has seen a tremendous loss of key personnel that have joined competitors
c) key business units such as Chartis will lose revenue as they are forced to shed business that they have underpriced for years (or dramtically raise rates on their policyholders)
All in all this has been a bad deal for the American taxpayer and will be for any stockholder who would buy the stock when the government begins to sell its stake.
Darth, I think you hit the nail on the head about this outlaw company. They got away with a lot in the past 20 years and it caught up with them. Their hands were very dirty. Remember they were one of the companies in bed with Marsh Mc on the bid rigging schemes of some years ago. That was small potatos compared to the credit swaps they were doing. Many Americans don’t realize that much of the bailout money given went to re-imburse foreign banks who bought into this Ponzi scheme. How do the taxpayers get that money back? The short answer is “They don’t”.