Some CNBC hair-do is talking about A.I.G. right now. "I don't see what the problem is. It has plenty of assets. It's just a liquidity problem."
Right. Only $90 billion in liquidity is needed.
"It's just that some accountant says so," he adds, acerbically.
Not quite. A.I.G. signed contracts that require it to maintain a certain amount of liquidity. It filed formal undertakings with state regulators that its insurance subsidiaries would do so. It sold bonds that guaranteed it would do so. It is required by federal and state laws to do so.
If A.I.G. doesn't abide by its contracts, assurance, guarantees, promises, and laws, then the other guy gets to foreclose. Right? Every homeowner and credit card owner in America knows this.
But Wall Street thinks they are exempt from all of that. And if they all whine loudly enough, the taxpayers will pick up the bill.
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1 comment:
Look out. Here comes Congress with its hands in our pockets. What's Wall Street's belongs to Wall Street. What's yours belongs to Wall Street, too.
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