Rescued by a Bailout, A.I.G. May Sue Its Savior
dealbook.nytimes.com
Rescued by a Bailout, A.I.G. May Sue Its Savior
1–10 of 99 posts
Re: Rescued by a Bailout, A.I.G. May Sue Its Savior
#2Surely the problem with their argument is that when they were bailed out they did have a choice; it was either accept the terms or go under. So if they accepted the govts terms, why should they now be allowed to argue they got ripped off.
Re: Rescued by a Bailout, A.I.G. May Sue Its Savior
#3This really makes my blood boil, but I'm trying to remain impartial while reading.
The highlight of the article:
> Judge Paul A. Engelmayer wrote that while Starr’s complaint “paints a portrait of government treachery worthy of an Oliver Stone movie,” the company “voluntarily accepted the hard terms offered by the one and only rescuer that stood between it and imminent bankruptcy.”
Sure, the terms might have seemed "unfair" but what could they possibly expect? It was "accept some harsh terms for royally screwing up or go under." It's not like they were some innocent bystander; they made some really stupid decisions and paid the price.
Side note: those "thank you" commercials feel so terribly disingenuous;
Re: Rescued by a Bailout, A.I.G. May Sue Its Savior
#4With government contract work here in New Zealand I have noticed a willingness to call in the lawyers very early. If the contract were with a private enterprise there is no way a contract would get renewed, however the government is happy to deal with people even after after they have been sued recently. This may not we a world wide phenomenon.
Re: Rescued by a Bailout, A.I.G. May Sue Its Savior
#5This really makes my blood boil, but I'm trying to remain impartial while reading. The highlight of the article: > Judge Paul A. Engelmayer wrote that while Starr’s complaint “paints a portrait of government treachery worthy of an Oliver Stone movie,” the company “voluntarily accepted the hard terms offered by the one and only rescuer that stood between it and imminent bankruptcy.” Sure, the terms might have seemed "…
AIG is trying to get money out of the situation. That's what companies do, and apparently this is what companies are supposed to do.
Re: Rescued by a Bailout, A.I.G. May Sue Its Savior
#6[deleted]
Re: Rescued by a Bailout, A.I.G. May Sue Its Savior
#7This really makes my blood boil, but I'm trying to remain impartial while reading. The highlight of the article: > Judge Paul A. Engelmayer wrote that while Starr’s complaint “paints a portrait of government treachery worthy of an Oliver Stone movie,” the company “voluntarily accepted the hard terms offered by the one and only rescuer that stood between it and imminent bankruptcy.” Sure, the terms might have seemed "…
I agree with the emotion but I can also see the argument that the agreement was made under duress.
If you are about to die and the only person who could save you, offers to do so, but asks you to agree to something reprehensible in exchange for saving you, what do you do?
At the risk of creating a strawman (the goal is illustration not substitution) let us construct a scenario, you're hanging by a rope which is breaking, you have maybe 10 minutes before it breaks. And the only person who can save you says, "Ok, I'll save you on the condition that in the near future I will come to you and ask you to do something for me, and you must agree to do what ever I ask."
What if your savior asks you to blow up an airplane? Or sell your spouse into the sex trade? or any of a dozen things you would never do voluntarily and are counter to your values. This is the kind of thing that novelists use to create tension, its very effective.
So AIG claims here that the Government went too far in its ask, and has crossed some line into moral turpitude. Who is the bad guy? the good guy? Doesn't really matter though, its one of those chickens they talk about that come back to roost. Never a good thing.
Re: Rescued by a Bailout, A.I.G. May Sue Its Savior
#8It's not like the government forced them to take the bailout. They could have declined and sunk into bankruptcy, they had a choice and they should live by that choice. If the company were run honestly and competently they wouldn't have ever been put into that situation in the first place. I'd like to call this whole scenario karma, ain't it a bitch?
Re: Rescued by a Bailout, A.I.G. May Sue Its Savior
#9However annoying this is, there is some truth to the claim that the takeover of AIG was a "backdoor bailout" of other firms. Somewhat like the IMF loaning money to countries like Thailand and South Korea during the Asian financial crisis. The bailout money went straight through the immediate recipients and on to their creditors.
Re: Rescued by a Bailout, A.I.G. May Sue Its Savior
#10From the article:
"It contends that the onerous nature of the rescue — the taking of what became a 92 percent stake in the company, the deal’s high interest rates and the funneling of billions to the insurer’s Wall Street clients — deprived shareholders of tens of billions of dollars and violated the Fifth Amendment, which prohibits the taking of private property for “public use, without just compensation.”
From a different HuffPo article for context:
"When news first broke in 2009 that Goldman had been an indirect beneficiary of the AIG bailout, collecting the full value of some $14 billion in outstanding insurance polices it held with the firm, the officials who brokered the deal justified these terms as a necessary stabilizer for the broader financial system."
http://www.huffingtonpost.com/2011/01/26/goldman-sachs-aig-b...
Say what you will about A.I.G being a douche joining a lawsuit against the Gov. Some ex-Goldman Sachs people brokered a deal that made Goldman whole at the cost we-the-people and with bad terms to A.I.G.
There is some legitimacy to that claim -- whether or not in the public perception it looks like AIG biting the hand.