I heard a quote from Nancy Pelosi (speaker of the house) on the bailing out of AIG (and the others), something like "all gain is privatised, all loss is nationalised".
The capitolists have been making the rule to their own games, and now it's the very people who have lost their homes due to the mortgage crisis that have to bail out the banks during the credit crisis. Not to mention other countries having to prop up the economy. I hear it's nesseccary so that we don't all lose everything. But I have nothing so I'm not that worried - I imagine it's the "haves" of this world that are a bit nervous now.
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| Fed bails out AIG. Seems you can be too big to fail afterall. Lehman was big, but clearly not big enough!
But the US government has deep pockets. If UBS were ever to find itself itself in the same situation, the issue wouldn't so much be too big to fail but would it be too big to save? If the government wouldn't or couldn't stump up the necessary, relying on outside help from foreigners is risky- they might just figure out it's better to let a failing business go bust then cherry pick the parts they want at fire sale prices from the liquidators and leave the toxic stuff behind, as Barclays have done with Lehman. | |
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