March 2nd, 2009
09:07 PM ET

Evening Buzz: AIG "Progress"

[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2009/images/03/02/t1.aig.econ.jpg]

Maureen Miller
AC360° Writer

The Dow took a beating today closing below the 7-thousand mark for the first time in 12 years. Blue chips ended the day down nearly 300 points, or 4.2%, to end at 6,763.29, while the Nasdaq shed 54 and the S&P fell 34 points.

The sell-off came after the federal government agreed to give battered insurer AIG another $30 billion. The revamped rescue plan now totals $162.5 billion dollars. That's our tax dollars at work. The extra $30 billion will come from the second half of the $700 billion rescue package approved by Congress last fall.

That's not all. Today AIG also posted a staggering $62 billion quarterly loss, the biggest ever by a U.S. company. The losses amount to about $460,000 per minute. Or let me put it this way: Every American would have to pay $204 to repay AIG's losses.

Do you think AIG should still be bailed out? Sound off below.

Tonight on AC360°, Chief Business Correspondent Ali Velshi looks at why AIG is so important to the global economy. Consider these numbers: AIG has 74 million insurance policies in 130 countries worldwide and they cover everything.

AIG's CEO Ed Liddy hit the media circuit today to pled his case. Liddy came on the job last September and is making just $1 a year. "We've made real progress starting in September and the latest round of solutions we think are a big step forward, " Liddy said in an interview with Ali today. Liddy added AIG resolves to do three things: Protect policyholders, payback every penny that is owed to the federal government and he said he has a "vision for the 116,000 people who work at AIG. They've done nothing wrong. They haven't contributed to this. But they are in fact going to solve it."

It's your money, your future. We'll have all the angles on this and tonight's other headlines starting at 10pm ET. See you then!

Filed under: Maureen Miller • The Buzz
soundoff (53 Responses)
  1. Phyllis

    I don't know whether AIG should be bailed out or not. I do know that I am tired of all the talking without seeing much result. Whether you are applying a business model or a psychological model, too much focusing on the problem increases negative thinking and fear, and the negative thinking and fear results in actions that increases the problem. How about more action and giving us more information about how the actions we have taken have helped.

    March 3, 2009 at 10:15 am |
  2. Chris

    Jake M. can tell you what will happen if we let AIG fail. The economy will tank far worse than it already has, and we will be more than 50% likely to enter into America’s 2nd Depression.
    to Jake M. – we are over the cliff. We are in a depression – it started Dec 2007.
    A depression a recession of over 18 months with significant recession indicators continuing in the future.
    Technically the depression may not be called until July 2009 – but the trajectory of the economic indicators cannot be turned in this calendar year. Once the depression criteria has been met, this July, the depression will be said to have begun in December 2007 and initially recognized as a recession and later corrected to depression – which it is.
    It is important to recognize where we are, and that the depression cannot be turned for at least 30 months from now. Only then will Government programs, nationally and internationally, be sufficiently supported and implemented to minimize the depth and duration of this depression and the human harm that will accompany this depression.

    Thanks for your ear.

    March 3, 2009 at 10:10 am |
  3. Michael "C" Lorton, Virginia

    Everytime a financial institution post a quarterly loss-–the government can't keep funneling more money to reverse their incomptent and bad investments---let the cards play--and when the dust settles--deal with what is left over.

    March 3, 2009 at 9:41 am |
  4. Jane Gray

    J. Ayers: You and I are on the same page! Break this company up like AT&T was in the 1980's as well as any other company that owes us money! Break them up if they are too big – and give us the jobs.

    March 3, 2009 at 8:47 am |
  5. Joe

    Isn't it time the government starts looking at just how large we allow companies to get? The AIG bailout may come close to 1/4 of a trillion $$. Why on Earth do we have these single companies owning so much in the world where there top investors can make such extraordinary incomes and leave millions of people out of work. Same is the case for GE. I am not an economist but someone smarter than me needs to decide just how big a company is allowed to become safely and once the company reaches that market share, it needs to be forced to start selling some of its partner companies to other investors, ceos and workforce. You will not only keep these companies from from becoming so large to the point they could "destroy the world" if they filed but it would open up the market for more jobs. Maybe, just maybe ceos and executives can cut back on their 80 hour work weeks and allow some other guys to have a piece of the pie/amercian dream as well.

    March 3, 2009 at 7:00 am |
  6. Vince

    I personally have never received a government bailout when suffering a financial crisis. AIG may be the largest insurance company in existence but still only serves a limited client base. When we hear so many 'experts' with varying opinions, for me the lack of consistency in predictions negates the term 'expert'. There is a considerable increase in acceptance when the institution I'm asked to support will benefit me and mine. The government programs that create American jobs and lasting improvements for all such as addressing energy concerns for the future that will need to be faced ultimately seem a more viable answer to where we as a country should inject a cash suffusion. I believe the market sorts the value of any industry and have suffered changes that affected my life negatively without my input and survived. I won't willingly support a program with my bankbook that seeks to save those whose own choices have led them to this crisis.

    March 3, 2009 at 6:04 am |
  7. Alexander Martin

    The Obama Administration is petty much making something out of nothing. The financial scars left by the Bush Administration is clearly a domino effect . Lets face it, the reprecussions are inevitable. With insurance claims on the rise another 30 bil is not going to change anything. When you have a conglomerate of company's failing at the same time, some of which have been allowed to become an monopoly, that means our foundation has been compromised and it is time to restructure. New york city subways are not build with one
    I beam, Handing out Bailouts without restructuring at this point is like trying save the titanic.
    Healthcare and AIG, are equally important to the health of this economy, so both sectors need to be restructured. You cannot have a radio talk show without your health.

    March 3, 2009 at 4:16 am |
  8. James in Atlanta

    Sounds like it is time to quit throwing good money after bad! Break AIG up into smaller pieces and sell them off to the highest bidder.

    Fool me once shame on you; fool me twice shame on me; fool me three four or five times shame on our government!

    AIG gave lavish parties, handed out big bonuses, during bad economic times and asked for government bail out after bail out after bailout; that just show they have not good business sense. Bailing AIG out just rewards the bad behavior they have demonstrated.

    Any company should not be allowed to get so big that it is considered “too big to fail” and we need regulations to keep the “too big to fail” from happening.

    Firms like AIG often get "to big to fail" by buying smaller profitable firms and through "cost saving measures" replace all the people who made that firm profitable with lower paid workers who do not understand good businesses practices.

    Sounds like it is time to reverse the trends of the past by breaking up firms like AIG that are "too big to fail" into smaller firms that are not too big to fail.

    March 3, 2009 at 3:45 am |
  9. J. Ayers Washington State

    Doesn't bailing out Chrysler seem like a better Idea then bailing out AIG? At least Chrysler paid the money back! Thanks to Lee Iacocca.

    March 3, 2009 at 2:53 am |
  10. Pati

    Well, As I see it , we need to have a special election when it comes to these issues.As a nation , not have politicains vote on Bail-outs on my (our) behalf. How does March 30th sound? I didn't vote or agree to bail out anyone!!!Stop the lobbyists and politicians from driving CORPORATE JETS and or CARS paid by us.How about the Banks, Corruption if every there was any. 30% apr's . And government lets it happen. CROOKS they are all CROOKS.Especially after we bailed them out. AIG just needs to fail. This country was built on success' and failures. They made the mistakes by mis-managing money not us! WE DO NEED TO VOTE ON THESE ISSUES, SHORT AND SWEET , Heck, I cant even send my son to college now because of all of this. Whats wrong with this picture. My 401k is gone, WHY WHY WHY???????? CROOKS ALL CROOKS

    March 3, 2009 at 2:38 am |
  11. J. Ayers

    I think the United States has always been the country that solves the worlds problems. The people/politicians of the United States can do anything if they put their minds to it. If we learn from the past (the deppression/stock market crash of 1929) we will find a way to fix the economic crisis of today.

    March 3, 2009 at 2:07 am |
  12. J. Ayers

    I think we all should have voted for Mitt Romney and Ross Perot They seem to know economics quite well. They would know what to do in this situation concerning the bailouts of all of these companies.

    March 3, 2009 at 1:51 am |
  13. J. Ayers

    I think this company should have been broke up into smaller companies. It should not have been allowed to be so huge. This seems like a worldwide monopoly in the insurance business.

    March 3, 2009 at 1:36 am |
  14. Christina

    When do the bailouts stop??? Good lord. It was their own bad behavior and bad decisions that caused this. You say it will cost me $240 as a taxpayer to not bail them out. Glad to pay it. Let them sink. Let all the others sink as well. I have paid my bills. I paid my credit cards and in return, they lowered my credit limits because "the banks are tightening their belts due to the credit crunch"., My credit rating dropped over 60 points in one month because they cut my credit limits, making it look like I charged up my credit cards (previously at 30% or less). Screw the banks. Screw the government. They screw everything up and the 60% of Americans who do actually pay taxes have to pay for it??? What the heck????

    March 3, 2009 at 1:23 am |
  15. Travis Banks

    I can't understand why we are still bailing out companies who most Americans owe money. Money is drafted directly out of thier paychecks to pay these multi-billion dollar corporations. If AIG has all these international entities, let them bail them out. How about they pull their Formula 1 sponsorship.

    March 3, 2009 at 1:23 am |
  16. Pati


    March 3, 2009 at 12:50 am |
  17. Zyworski

    What did AIG lose money on? If they are going around trying to indemnify the business world against risk then they should just reap what they sow.
    Tthey have taken positions that are untenable and to bail them out while they still have potential liabilities is just throwing bad money, after more bad money.

    March 3, 2009 at 12:43 am |
  18. Marcela Economidis

    Obama needs to come out as strong as FDR did. He needs to focus on the economy.

    As for AIG, I've lost almost half of my life savings. WHERE IS MY BAILOUT????????

    March 2, 2009 at 11:17 pm |
  19. Rovenia

    I'm mad, where is my bailout! I'm a single parent who need a bailout but the Govt.seem not to care about me and my finances! Again where is my BAILOUT!

    March 2, 2009 at 11:15 pm |
  20. Kim

    A quarterly loss of 62 billion ? What results will we see sending another $30 billion ? Where can Americans find the transparancy on where the 150 billion sent was spent ?

    March 2, 2009 at 11:14 pm |
  21. Jane Gray

    It seems to me if MY insurance company went bankrupt, I would just have to find another one. Why are we supporting a company based upon premium payments and assessment of risk. Seems like we could let them go and just pay the claims? Or am I not understanding something here?

    March 2, 2009 at 11:13 pm |
  22. David Lorenz

    Anderson, if we are paying off all of AIG's bad debts from insuring mortgages and CDO's that go unpaid WHO IS THE BENEFICIARY OF ALL THE MONEY...WHO IS GETTING ALL THE MONEY THAT THE GOVERNMENT IS FUNNELLING INTO AIG???

    March 2, 2009 at 11:11 pm |
  23. Shaun, Silverthorne Colorado

    Has there ever been a consideration by Pres. Obama or anyone in power, about bailing out the taxpayers and not the banks!! The banks would end up with the money in the end and taxpayers would keep there homes and 401k or retirement funds.
    Couldn't giving taxpayers a $100,000. each boost the economy. People could pay off debt and banks would get capital… isn’t that what we want???
    Someone must have an opinion on this?? Anderson, what do you think???

    March 2, 2009 at 11:08 pm |
  24. CJ

    In reality, most parts of AIG are doing well. It is the credit derivatives arm of this company that really sent them into a tailspin. It should have sent them into a tailspin! They were basically "betting on" if people would fail on their mortgages. Nothing like gambling and then screaming for help when you don't win. If prior administrations wouldn't have given up on regulating big business and letting these folks go unchecked for so long then we may not be in the mess we are in. We can thank our congressional leaders for letting it go because some lobbyist was promising them something big. Now we have a person in our administration who "Rush" wants to fail. Do conservative republicans always have a "fat cat" mentality. If we let AIG fail, no one will have to worry about any sort of recovery because of the ripple effects on our global economy. Can we just turn Rush off since he really isn't anyone who makes any decisions that should have any impact on any of us. Or have we elected him to be "Speaker of our houses"

    March 2, 2009 at 10:47 pm |
  25. Sherry, N. Calif.

    Hang on we are in for a long wild ride until DODD gets a plan for Bank & Wall St. Regulations. Regulate, regulate, regulate. No oversight, no transparency when they married Wall St. and Commercial Banks in 1999! No more regulations. These supposedly smart men that run our financial institutions stole from the American people. They sold risky investments to other countries. Personally, they are all sitting fine with their millions in bonuses paid to them at end of 2007. Four CEO's in Goldman Sachs received $70 million each. What does that tell you? We have not bottomed out. B of A is in trouble, as is Citi. They willl need more and do not kid yourself AIG will be back. Sorry for the bad news but I feel BAILOUTS are not over yet!

    March 2, 2009 at 10:37 pm |
  26. Barbara

    THEY JUST DON'T GET IT...AIG & any insurance company should NOT be bailed out. Why? Because as a small business owner who
    has never had a claim, my insurance varied from $17,000 to $60,000 a year. It was/is whatever-they-think-they-can-get-by-with knowing I could not remain in business without insurance.

    My daughter was in a terrible car accident & the insurance company refuses to pay. It took 5.5 years, 7 lawyers, & my daughter suing
    ME before the insurance company would pay. They knew all along that they were obligated to pay but just refused. Nice, huh??

    This crisis is about lies, mismanagement, and mistrust. The small business owner or homeowner works so hard to "make it"...& the
    big insurance corporations, wall street, & government take take take.
    I am so sick of watching persons who produce nothing except regulation, paperwork, & manipulations to line their own pockets be the "winners". This country is far off track & I am so tired of trying to survive within it that I don't care if they all fail. Perhaps then, true work & production will again have meaning.

    March 2, 2009 at 10:28 pm |
  27. Elizabeth F

    If banks and insurance companies are the ones helped first, who will deposit money and who will get insurance if people have no jobs? If they are bailed out, who will they help, of course those who have money or means to pay them back and who are they? Those who have money. Are these banks and insurance company going to help those people who needs them and yet don't have a job as guarantee that the money loaned them will come back, with interest, of course?

    March 2, 2009 at 10:26 pm |
  28. Brandon

    This is a sad time for americans. We keep bailing out those who can not get above the waters, and This is the same AIG that sents its CEO and high ups on a trip. This is a company that for some reason needs to be bailed out every 3 months or close to it. I understand AIG is needed my insurance is with them. BUT LET THEM FAIL. We are crumbling with all the fear and wasteful spending. Where is all this money coming from?

    March 2, 2009 at 10:24 pm |
  29. Milton

    This thing is getting just plain scary. At this point I wonder if their really is something that can be done to change course. I agree that perhaps the world economic condition is becoming so aggravated that its weight might water down the effects of the stimulus package, which brings up the next important question: how many weapons do the feds have left in their arsenal to combat this endemic economic episode!

    March 2, 2009 at 10:22 pm |
  30. Dolores Basinger

    Do you think the majority of U. S. citizens have grown weary of this AIG bailout scenario? Why should we sink more tax dollars into AIG?

    March 2, 2009 at 10:18 pm |
  31. Connie in Vegas

    AIG is the final punch to the gut for the world economy. If its bailout dwarfs all others, then we should demand to know where the $ is going and name names. This economic collapse is not because of any planned furure expenditures in Obama's budget, it is the result of GOP failures (deregulation, no oversight) over the last administration. We need to wake up!

    March 2, 2009 at 10:18 pm |
  32. Luis

    The reason why AIG is tanking is because the bet heavily on companies like Lehman Brothers wouldn't collapse. Well, Lehman went under and so people demanded their insurance on their investments at Lehman.

    Think of it here:
    You buy 1,000,000 worth of bonds from your city.

    Now you pay AIG for the insurance of those bonds at $70 dollars a month or so.

    Now say, the city gov. Defaults. AiG is suppose to take care of the problem. But it cant, because they never thought the city council would ever default. That's what happen.

    March 2, 2009 at 10:16 pm |
  33. Jake M.

    I can tell you what will happen if we let AIG fail. The economy will tank far worse than it already has, and we will be more than 50% likely to enter into America's 2nd Depression.

    March 2, 2009 at 10:16 pm |
  34. Arnie Fertig

    If I understand what is being said, AIG is loosing all these billions of dollars because they are having to pay out on policies that they issued to guarantee mortgages that had been securitized.

    So here's the question: who are the people / companies / institutions that own all these policies and are receiving all these billions of dollars from AIG?

    Why can't part of the solution be to discount the amount that AIG must pay out for all these bad loans?

    March 2, 2009 at 10:15 pm |
  35. Georgie

    My money is on Obama.
    Give the President a chance, he doesn't look to worried, it's all under control, no problema, relax...take it easy!

    March 2, 2009 at 10:15 pm |
  36. T. Alford

    If the money given to AIG and these banks were given directly to unemployed Americans and others that make less than $50k ( over 35 million ) to pay their mortgages and pay off debt. Getting debt off of Americans will give people the confidence in saving in Banks. The economy will jump tomorrow back to life. Stores will have customers, everyday home utility necessities will be paid and the banks will get the money back. The everyday purchases from people we overlook, ie; Grocery Stores, Phone Bill, Gas Bill, Light Bill, etc. creates jobs.

    March 2, 2009 at 10:13 pm |
  37. Martha Allsup

    OK. The Republicans are 'upset' about the added bailout for AIG? Well, they are the ones who gave out all this money to all of these Wall Street companies with 'no strings attached'. "We the people" saw the excesses of these companies and their executives and wonder why they get all this help but the Republicans aren't willing to help the average American. Well, we know who the Republicans support and it isn't the 'average' american. They are all for the rich, big corporations, and the well connected. Boo to the Republicans and shame on them. We the people should vote out everyone of them.

    March 2, 2009 at 10:12 pm |
  38. Marc

    I wonder WHY nobody has focused ( on all this "bailout") on the "pedestrians" here.
    Because GM and AIG get there billions, where does the money for us to BUY these products???
    Don't they need us?

    March 2, 2009 at 10:11 pm |
  39. taofik

    we all need a bailout.
    just before President Bush left office this people have been having bailout. my question is this when is this going to stop? the same people that mismanage their companies/ enterprises are given bailout funds how are we sure they will squandered the tax payers money President Obamas administration will give them.
    i know the dire consequences of not providing this bailout but my point is that i don`t want the same people that lead to the failure of these companies to manage their financial affairs

    March 2, 2009 at 10:11 pm |
  40. Elizabeth F

    I'm not for bailing out banks,insurance companies and companies like that because there would be those small companies that people can go to for needs on such companies. The low and middle class people are the once last affected by losing their jobs, so they should be the first that needs help.

    March 2, 2009 at 10:10 pm |
  41. Jerry Bryant

    Why can't the Government give each of us a 100K line of credit through the banks to fund "real people" and NOT corporations. plus 250-500K for small businesses.

    March 2, 2009 at 10:09 pm |
  42. Patrick

    If AIG insured all these bad loans for the banks and is in trouble because they have to pay out on these policies to these banks why are the taxpayers bailing out both sides? I don't get it??!!

    March 2, 2009 at 10:08 pm |
  43. Kathie

    No I do not think AIG should receive more of our money. In fact when they received monies from the first bailout I promptly called them up and canceled my car insurance. I am responsible for paying my own bills and managing my resources in an appropriate manner, and they should be too. At least if they want my business. Going forward I will be looking at a company’s business practices prior to becoming a customer. If they aren’t on track, or are spending time at spas and calling it a business trip then they aren’t for me. I will happily pay more for the services of a company who gets it.

    March 2, 2009 at 9:59 pm |
  44. DeAudry Roquemore

    Anderson, I am confused about what the bank bail out was for. We as americans was told that we had to bail out the banks that was in trouble of going under. We went for that. But I now find that banks that wasn't going under received some of the money, i.e., Iberia Bank, Lafayette, Louisiana. That bank is now saying that they are giving the money back because there are too many strings attached. Andy, they didn't need it. They wasn't in trouble of going under. They wasn't even having a problem. So, why did they take monry that could have been used to get our nation out of trouble when they didn't need it? And, how many other banks took the money just because it was out there?
    Banks like that is just as bad as AIG. You have the platform. Put it out there so all of the banks who take money will be checked for NEED.

    March 2, 2009 at 9:52 pm |
  45. Sharon S

    So no one in particular is going to be held responsible for the failure and losses of AIG we just have to fix it now?

    That to me is the most pathetic thing I have ever heard of! I mean it's all great that the CEO is doing something NOW but what about the people who were running this company and caused this entire mess? Are any of them being held responsible or did they just all walk away filthy rich and now they don't have to worry about it?

    March 2, 2009 at 9:38 pm |
  46. Annie Kate

    If AIG was too big and integral to fail the first time how would that have changed in the interim? I don't like bailouts but if not bailing them out means more pain for the economy – pain that could be averted – then perhaps it is justifiable. Sounds like the head of AIG has a plan at least and they havent' had that much time to really get started on a recovery – perhaps we are expecting too much too soon on the recovery side. I'd like to see the pros and cons on this bailout – what are the benefits of going ahead with the bailout and what are the costs – as well as what are the benefits and costs of not doing it. What else will go belly up if AIG fails? Until we know the consequences of action or inaction I don't think we can make a good decision on what to do.

    March 2, 2009 at 9:23 pm |
  47. Isabel, Brazil

    The week starts badly in the stock market. Stock exchanges around the world operated in strong in this low Monday.

    Hungary has made a proposal for the EU to make a contribution of capital in banks in countries such as Latvia and Lithuania. But the proposal was rejected by Germany, is one of the reasons that the stock markets down today.

    And the champions of the day for the fall in stock markets around the world: HSBC and AIG

    AIG is the big white elephant with many losses, but the government must help it.

    March 2, 2009 at 9:22 pm |
1 2