Bear stearns, Fannie Mae and Freddie Mac were bailed out by federal gov.

Lehman's brothers was left to die (nobody understands henry paulson's doctrine to bail out 1st three bank but leave Lehman's to die)

Merrill Lynch & Co swallowed up by Bank of America

now is AIG facing the axe?

 

Bear posed greater risk than LEH. When Bear was bailing out, JP came in play and offered the substantial price to rise the firm from its death-bed. But in the case of LEH, none of the private equity came forward in an attempt to rescue this dying equity firm. LEH being turned down by multiple banks over the weekend where there was a feeling that the LEH will possibly being taken over. As no buyer in market, LEH has no choice other than forcing itself in counting Chapter 11.

Also, if Bear would have gone the same route, there is a possibility that the market would have been hit much harder than on LEH. Bear would have created a catastrophe if it has gone seeking for Chapter 11. Bear had about $9 trillion of financial holdings which were shared with other financial institution, and when LEH is compared, it won't worth 1/10 of its value. Since the attachment of Bear is disseminated to other financial institution, it posed a great threat of taking others down when it files for chapter 11, but in case of LEH even it went down, it took no one but itself.

Fed cannot save everyone, and it is the truth. F/F is a core pillar of US mortgage industry and their demise would much impact the lending trend that has seen in years. If tomorrow, AIG goes for the bankruptcy, and if there is no buyer, Fed would not intervene.

i second u jim

fed. takes over AIG

B,

If you look at FED unprecedented move, you will notice that the rescue is NOT take over like F/F, but FED is ONLY injecting 85B to the troubled AIG. By doing so, the FED would get about 80% stake in the company. This firm is also too big to fail, and the money FED is lending is only for 24 months. This is NOT the takeover but only a big chunk of loan.

AIG will receive a bridge loan of $85bn to keep it afloat until it could dispose of billions of dollars in assets. The loan is expected to be repaid by the proceeds of selling AIG operating companies. The most likely outcome will be an orderly liquidation of AIG, though it is possible that the firm can survive as an ongoing business (ray of hope).

I can see American economy in trouble.............isn't it?

jim

many says it's like french style capitalism here in united states

now buying merill lynch the bank of america has itself come under scanner , who knows better than ken lewis

the dow jones is still down, so around the world

oil prices failing but nobody cheering it up, fed refused to cut down rates

 Mr. HANK GREENBERG (former ceo AIG) rightly said if bridge loan not infused, it would be a diaster

nobody knows if it had failed, upto what extent the ripple would have been felt in america and around the world

flip side of the story new yorker's psychiatrist expecting boom in their business from recent economic turmoil

 

 

bush cancelled all his visits and staying in washington to closely monitor the financial situation re

http://www.npr.org/templates/player/mediaPlayer.html?action=1&t=1&islist=false&id=94771320&m=94771305