Wednesday 17 September 2008

Robin hood's evil brother

"We're essentially continuing a system where profits are privatized and ... losses socialized," said Nouriel Roubini, a professor at New York University's Stern School of Business.

Let's try and translate this gobbledigook:

"We steal from the poor and give it to the rich," said Robin Bad, AIG CEO, and evil brother of the famous Robin Hood.

"Having invested a lot of time and money in armed robberies, we must confess feeling a bit stupid seeing how easy it is to get out of the Federal Reserve Bank," said Bonnie and Clyde, famous robbery professionals. "We risked our lives, we even got killed for not even a single percent of that amount!"


Anonymous said...

Totally agree. Losses for the people. It's a shame.

jldugger said...

Look, it's an offer to a loan, subject to shareholder approval etc. If AIG's problems are truly about liquidity of assets and not their value, then the Fed's mission as lender of last resort is workable.

The other thing to keep in mind is that they're not obligated to take any of the offer. It's expected that AIG can use this offer as a publicly known bargaining chip when pursuing money in the private sector. AIG doesn't have to touch the Fed's money for that, either.

If it's a capitalization problem, that's another story.

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