Bloomberg is reporting that the US is considering a conservatorship for AIG. Their story will follow. If you’re in a rush to get the news, however, you can read our version from three hours ago.
UPDATE: Bloomberg’s story is now up.
UPDATE: CNBC is reporting that there are doubts at Treasury about the legal authority of placing AIG into a conservatorship, as we reported in our original story.
(Image via Barry.)
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- Use the Bloomberg command
NH BLG_DEALBREAKER <GO>
to access Dealbreaker
“They’re story will follow”
Does your version have better punctuation than they’res?
Does your version have better punctuation than they’res?
That’s not true. Its a misposted BB story like the Steven Jobs one and the UAL story.
Does your version have better punctuation than they’res?
Does your version have better punctuation than they’res?
but your story doesn’t have any more information than that, so I guess I’ll have to wait for theirs.
“Officials at the Treasury Department are considering a government takeover of AIG, possibly placing the company into a ‘conservatorship’ as occurred with Fannie Mae and Freddie Mac, according to a person familiar with the thinking at the Treasury. There may be considerable legal obstacles to such a takeover, as it is not clear even to Treasury officials what the authority for such a takeover might be.
It is far from certain that this plan will come to fruition, according to the source. The questionable legal authority for the move may make a Fed loan more likely. The discussions at the Federal Reserve and the Treasury are ongoing. In fact, it seems as if many of those involved with the discussions are floating rumors about the discussions, perhaps hoping the market reaction could influence the outcome.”
Conservatorship for AIG is fo shizzle ma nizzle.
@1, 2,3,5 & 6 – FUCK OFF!
Treas. is going to wait til Fed makes the loan and then place them in Conservatorship.
HA!
HA!
@7 – As of 5:20 The Bloomberg story (http://www.bloomberg.com/apps/news?pid=20601087&sid=a11UW1B8w8uM&refer=home) doesn’t have any more information than that. Only it took Bloomberg 3 hours longer for to not have the further details…
@11: Thank you.
AIG’s response to every loss claim: Sue Us!
Ask anyone in insurance or unlucky claimants
This will be in courts til 2020
Legal authority? This is the Bush administration, since when did they start caring about that?
Dealbook says U.S acting on own.
http://dealbook.blogs.nytimes.com/2008/09/16/federal-reserve-may-act-alone-in-rescuing-aig/#more-26538
Too long, did’re read.
AIG filing for bankruptcy tonight
http://dealbook.blogs.nytimes.com/2008/09/16/federal-reserve-may-act-alone-in-rescuing-aig/#more-26538
Unless fed saves them of course. Announcement at 6
Today Dealbreaker grew up. This was market-moving news you guys had first, by far, and money was made trading on it before th market knew.
Kudos for this and for the whole week to John and Bess (&EP?).
Not long now until you are referred to as the Socialist Republic of The United States of America.
note to self- Study for LSAT
Kimberly Tara, lesbian would be no different from Kimberly Tara , truck driver. Just because results are bad is no reason to call names . Men always do this
@18
Are you kidding? The price was already trading below $2 before this article as posted.
18 is an idiot
@18
Are you kidding? The price was already trading below $2 before this article as posted.
@18 I agree…the bleeding and discomfort should go away in a few days and you can look back at this with regret and sorrow. But seriously good work JC, Bess, EP, Bob, Phil, Hank, JoJo, Shaniqua, Ray Ray
18 is high on low grade PCP. Give him about 14 hours he’ll be ok.
18 Huh? Isn’t it simply that blogs in general post innuendo when places like BB won’t. And sometimes it actually turns out to be true. Not sure i would regularly go betting the house though.
Will WB please stand up and bow out. LEH will show you the way out. AIG is already headed that way. Please, no tears. MS, please ready your stuff, your name will be called soon.
@27: You should read us more. We’re not “blogs in general” and when we post stuff that claims to be factual and source based, that’s what it is. When its rumor we make that clear. Use your own judgment, of course. But you should do that with any newssource.
I don’t understand the criticism of DB. This was my source for breaking financial news in the past 5 days. And JC makes an excellent point in that all posts are prefaced with whether or not they are rumors or fact based.
18, though your comment was a bit extreme, you are right, DB has grown up in the past week and distinguished itself.
it’s that time again, updating my chart from yesterday…based on preliminary reports, looks like aig is being taken off “death watch” and moved to “purgatory” as a result of the questionable “conservatorship” move by good old uncle sam. we’ll see how this plays out tomorrow and over the rest of the week – stay tuned. needless to say, the demise of aig is an omen for the rest of those on death row.
Bailed Out:
BSC – Assets: $399 bn; Liabilities: $387 bn; Current Mkt Cap: NA
Purgatory:
FNM – Assets: $886 bn; Liabilities: $844 bn; Current Mkt Cap: $515 mm
FRE – Assets: $879 bn; Liabilities: $865 bn; Current Mkt Cap: $168mm
[AIG - Assets: 1,050 bn; Liabilities: $961 bn; Current Mkt Cap: $6.2bn (after hours)]
Toast:
LEH
Assets: $639 bn; Liabilities: $613 bn; Current Mkt Cap: $207 mm
Teetering [aka death watch]:
WM – Assets: $310 bn; Liabilities: $279 bn; Current Mkt Cap: $3.9 bn
WB – Assets: $812 bn; Liabilities: $734 bn; Current Mkt Cap: $24 bn
WFC – Assets: $609 bn; Liabilities: $561 bn; Current Mkt Cap: $116bn
from the ms conference call (is anyone else listening?): teaming with a commercial bank could be “detrimental” to the business, we do not need a deposit funding base to survive…sounds like someone has laid down the gauntlet (beyatches!). also of note, the boys/girls across the street from leh have reduced their exposure to sub-prime to zero – that’s right, “0”. What does that tell you about their view of sub-prime? this is a wake up call for all those holding those toxic securities…
http://www.youtube.com/watch?v=UcQNddGLFN8
btw, didn’t have a chance to listen to the gs call, anything interesting happen?
@29
Love you boy! Get Hank to ring-fence the haters.
The fed can barely keep a lid on the federal funds rates. I’m thinking the fed better call the mint or that erstwhile DB poster and have them start printing money.
I think John and Bess do a great job. I keep them open all day, right under BLP
When did MS divest themselves of all their subprime exposure? Did this shit magically happen in some mystical twilight hour?
@ 35 I agree! WTF?!?!?
@ 35
Yeah. When did they?
That’s it- fuck MS. WG sit back down. MS is gonna get the belt, the buckle, and the bloody knuckle.
@35
Traded it for T bills from the Fed?
@35 et al – you don’t have to “divest” assets to reduce your “exposure” to zero.
From Dealbook:
“A.I.G.’s collapse seemed so likely on Tuesday that the company hired the law firm Weil, Gotshal & Manges — which is also handling the Lehman Brothers bankruptcy — to draw up bankruptcy papers.
Many of A.I.G.’s subsidiaries have drawn down on their credit lines, people briefed on the matter said.”
The terrorists are winning.
They didn’t even have to throw rocks. We did it to ourselves using our houses as ATMs and fancy financial engineering.
Osama bin Ladin must be laughing
There isn’t going to be a conservatorship. First, it’s illegal. Second, it would apparently, according to analysis that CNBC leaked out of the meeting, set off the CDS anyway and therefore defeat the point.
AIG basically needs $100 billion in capital in 6 and a half hours or it’s going to go bankrupt.
I think it is important that we (investors, traders) focus on what is important to us.
When AIG was trading below $2 this morning, we sold the 5.00 september puts on this baby. Then when it hit $5, we sold the $2.5 calls to look a sure gain no matter what. The position is not short a gut strangle with 2.5 profits already locked in.
As traders, we love this market (but we wish that this mess ends soon, after all we have a heart)
http://financialtraders.blogspot.com
@44 nice-AIG basically needs $100 billion in capital in 6 and a half hours or it’s going to go bankrupt.
…and a bus to take us to the airport to meet a fully fueled plane with a pilot and our demands will be met or we..um…
Ban 45′s IP for advertising. And trade 45 to the Russians for some damaged equities.
Breaking News
*
The Fed is considering offering a secured bridge loan to AIG, and under the proposed rescue plan, the U.S. government may end up controlling the firm, according to a person familiar with the matter.
@35-40, their “net exposure” is zero, which means they have hedged against all their positions. Learn how to read financial statements, or at least how to google the answer.
An all round well written piece!