Posted on 07/09/2009 9:26:34 AM PDT by FromLori
American International Group Inc (AIG.N), the insurer rescued by a series of federal bailouts, may have zero equity value due to the risk of more credit default swap losses and the disposal of key assets at low valuations, Citigroup said.
Shares of the company fell 22 percent to $10.22 in early trade Thursday on the New York Stock Exchange. The shares have lost more than 90 percent of their value in the last year.
Potential markdowns in AIG Financial Product unit's regulatory CDS portfolio may result in collateral calls that would again put pressure on AIG's liquidity,
"Such collateral calls could also pressure rating agencies to lower their credit ratings for the company, leading to a similar cycle to the one that the company experienced prior to the massive government intervention in the third quarter," Shanker wrote
Last month, AIG revised its 2008 annual report to add a new risk factor that shows it may recognize valuation losses on a CDS portfolio if credit markets continue to deteriorate.
At issue is a super senior CDS portfolio held by AIG Financial Products with a notional value of $192.6 billion as of March 31, 2009.
Shanker said despite AIG's efforts in implementing the action plan devised in concurrence with the U.S. government, the uncertainty and risk surrounding AIG remain very real, and, in some ways, more urgent.
The analyst cut the price target on AIG stock to $14 from $36 to adjust for a 1-for-20 reverse stock split by the troubled insurer, and kept a "hold" rating.
Once the world's largest insurer by market value, AIG nearly collapsed last year because of losses from CDS, a bet on the credit worthiness of a debt issuer. The company is now selling assets to repay the government after a bailout totaling about $180 billion.
(Excerpt) Read more at reuters.com ...
Of Course, the US Gov’t owns it.
How many bailouts is too many bailouts?
AIG should have been stabbed through the heart at the first go round, but wasn’t because it would have brought down Goldman Sachs.
Now it’s going to melt down again. How much this time? 90 billion? 120 billion?
“Too big to fail” will invariably be thrown around again in the haste to bail AIG out, again. Rinse and repeat seems to be the norm for Barry and Dems, hence why they ballon circulating a 2nd stimulus.............
Now, here’s a case of the pot calling the kettle black. How much equity value does Citi have?
Very perceptive I call them CITI fraud...
http://www.marketwatch.com/story/pandit-lewis-diverge-strategy-new-york?tool=1&dist=bigcharts
EXCLUSIVE:
President Obama continued collecting money for his 2010 Senate re-election campaign even after he resigned his seat from Illinois, including a maximum $2,300 donation the day after Christmas from a top executive of a Wall Street firm that had received a government bailout.
Four contributions - $4,800 in all - were donated to the Obama 2010 fund on Dec. 26, according to Federal Election Commission reports.
The money came from some of Mr. Obama’s top presidential fundraisers: Bruce A. Heyman, managing director at Goldman Sachs, which received a $10 billion bailout last year; Steven Koch, vice chairman at Credit Suisse First Boston; and John Levi, a lawyer at the law and lobbying firm of Sidley Austin LLP.
The donations are legal, but the timing is unusual because Mr. Obama formally left the Senate on Nov. 16 and already had a surplus in his Senate campaign treasury.
http://www.washingtontimes.com/news/2009/mar/27/obama-raised-cash-even-after-leaving-senate/
From No Quarters...
Let’s start with the numbers. Why is a first term Senator pulling down almost $300,000 a year from Goldman Sachs, Lehman Brothers, Bear Stearns, Fannie Mae, Freddie Mac, AIG, Countrywide Financial, and Washington Mutual? He has not even completed his fourth year in the Senate and received a total of $1,093,329.00 from these eight companies and their employees. (all data from OpenSecrets.org). John McCain’s numbers, according to OpenSecrets.org for the period 1990-2008 (i.e., 18 years worth of data) only collected $549,584.00. In other words, Barack is receiving $273,582.25 (and 2008 is not over) per year while McCain raised a paltry $30,532.44.
Want another shocker? Barack Obama has received more from one source–Goldman Sachs $542,252.00–than McCain has from all of the companies combined. Who the hell is more beholden to lobbyists? And why does a junior Senator from Illinois rate this kind of dough?
http://www.noquarterusa.net/blog/2008/09/21/baracks-wall-street-problem-is-now-americas/
CITI-FRAUD, PURPOSELY or incompetently The Resident cut a real bad deal for US!
While sucking us dry to the tune of $45 Billion!
http://www.reuters.com/article/newsOne/idUSTRE52F3MP20090316
Movin on Up to the Treasury
http://online.wsj.com/article/SB123732747181462245.html
US of Citi-fraud, Coincidence??
http://www.americablog.com/2009/02/united-states-of-citibank.htmlh
Top Donor to the Resident’s Inaugeration.
http://www.newsmax.com/insidecover/citibank_obama_donors/2009/01/15/171703.html
AIG Kickback
http://www.redstate.com/california_yankee/2009/03/17/obama-received-a-101332-bonus-from-aig/
Freddie/Fannie Payoffs
Government Sachs
http://tpmmuckraker.talkingpointsmemo.com/2009/03/government_sachs_tarp_funds_just_the_tip
_of_th_ic.php
From Op Ed
While not on the Center for Responsive Politics list of the top 20 contributors to the Obama presidential campaign, Mayer-Brown’s partners and employees are in rarefied company, giving a total of $92,817 through December 31, 2007, to the Obama campaign. Seven of the Obama campaign’s top 14 donors consist of officers and employees of the same Wall Street firms These seven Wall Street firms are (in order of money given): Goldman Sachs, UBS AG, Lehman Brothers, JP Morgan Chase, Citigroup, Morgan Stanley and Credit Suisse. There is also a large hedge fund, Citadel Investment Group, which is a major source of fee income to Wall Street. There are five large corporate law firms that are also registered lobbyists; and one is a corporate law firm that is no longer a registered lobbyist but does legal work for Wall Street. The cumula tive total of these 14 contributors through February 1, 2008, was $2,872,128
Those are very good links. One thing about Obama—he seems to return favors to his contributors. Take for example, the recent appointment of a no-experience contributor as Ambassador to the UK. Is he the rare politician who stays bought.. at least as long as its convenient? If so, the contributions from the financial companies you’ve named are all the more disturbing.
Its a funny thing I think most people bought into the idea that he was not for the banks when just the opposite appears to be true. He was bought and paid for as a junior senator for heavens sakes.
Some were starting to get it but few..like dirty durbin slipped up and said frankly the banks own the place.
http://www.businessinsider.com/henry-blodget-is-obama-in-wall-streets-pocket-2009-4
http://www.bloomberg.com/apps/news?pid=20601039&sid=aNMQDysdnKRc&refer=home
Catherine Austin Fitts
http://www.opednews.com/articles/6/Obama-s-New-World-Order-by-Stephen-Lendman-090410-741.html
Obama takes care of his own....Goldman, et al.
Exactly tax cheat tim didn’t come without the highest recommendations lol
Speaking of did you see the latest on goldman?
“It’s curious to note that Goldman Sachs has admitted that it has developed trading software that could be used to, in their own words, “manipulate markets in unfair ways”, yet nobody in the mainstream media has questioned whether Goldman Sachs was / and is using its proprietary trading platform to manipulate markets in unfair ways. Only extremely naive investors with zero understanding of how global stock markets operate would deny that there has been continual and excessive intervention into US stock markets to prop them up over the past several months.”
http://www.marketoracle.co.uk/Article11902.html
AIG: Footing the Bill for the World's Richest Team
AIG Deconstructed: AIG Rules Iraq
AIG Deconstructed: Why AIG Owns 900 Jets
AIG Deconstructed: Stowe Mountain
IMO-AIG is a loss. They just did a 20-1 reverse split a couple days ago. Their stock price has plummeted from $22 post split to $10.80 today. The short sellers are eating AIG up!
Thanks for the link.
I also have to stick up for corporate ownership of corporate jets. It is HIGHLY efficient for corporations to own their own airplanes, and it makes a great deal of financial sense.
The problems at AIG were caused by the London office, and most of the AIG subsidiaries are honest and sound.
Is that why todays closing stock price is half of what it was after the reverse split? If the company was sound, its' stock wouldn't have dropped 50%.
Please read what I posted.
The subsidiary companies ARE sound, for the most part.
The negative numbers at the London based Financial Products group have sunk the other, positive numbers.
ALL of the AIG owned independent brokerages are profitable.
The insurance subsidiaries are sound.
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