AIG American International Group, Mega Cap Failures »
Posted By IIDavidCoffinII 1 year, 1 month ago in Business & FinanceIn the worst American housing slump since the Great Depression, even as banks face greater scrutiny the Federal Government has agreed to loan as much as $85 billion to the depressed company in exchange for an ownership stake of 79.9%. This agreement has found great opposition from stakeholders whose shares would be significantly diluted. There is a shareholder meeting planned for tomorrow, September 23, 2008 to discuss alternatives to the Government bailout. AIG started the day at $4.86 a share the morning of September 22, 2008. The stock sold for more than $72 in December 2006.
This shocking turn of events has led to a standstill of American interbank lending, a very doom and gloom market indicator . With a $709.1 billion trade deficit, an unstable increase in currency circulation of the American dollar, and a dramatic decrease in the worth of government bonds it's surprising to find that the American dollar's value has remained stable on the global currency exchange.
Interestingly, Robert Willumstad, the replaced AIG Chief Executive Officer has rejected a $22 million severance payment he was allowed in his contract.
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IIDavidCoffinII
Senior Editor of VersaGlobe International Limited. I enjoy reading and playing with my pets.
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