What does all of this mean for someone that has life insurance (and a substantial amoutn of it) through AIG?
Should we be filled with panic yet?

I have two questions that pretty much has nothing to do with the current topic:

I bank through Wachovia. Should I be worried about my bank?

I also have this urge to buy stock while they are currently low. Good idea or bad idea right now?

If AIG goes under, at least I’m well positioned to profit from the catastrophe by printing these and teaching people how to use them.

Why this is election is so important. If anyone think the elected President is someone who issue a quickfix like just redistributing some dollars and cents then America competitiveness will be just doomed.

This is the time where unity and values shall be recalled for everyone to take some hard look and cut right down to the basics. By now it is clear who is willing to taking even political risk just to unify parties, across parties or not even these meaningless definitions. And the person is not Obama who already divided his party like never before.

false breakout over the 50 dma on SKF yesterday and this a.m. Pretty hard to get your mind around how the ultrashort financial SKF is not tracking the bad news, nor is the BKX seeming.

OTOH, this is kinda interesting

http://image.minyanville.com/assets/FCK_Aug2007/File/71presenttrack.jpg

I saw this comment at the Youngstown Vindicator opinion page blog and thought it worthy to reproduce here. The commenter is responding to a blog post about an article in the UK Guardian. Interesting take on the whole situation…

Sorry Tyler I have to disagree with the whole premise of the Guardian article. It actually it is the abolishment of Glass-Steagal that will make the economy sounder when this is all said and done. Lehman Bros and to a lesser extent Merrill were pure-play investment banks – they had no commercial banking function (also Morgan Stanley and Goldman are the last two that are standing as pure-plays). The article loosely connects the dots with some vagueness about the moral hazard of buying and selling off securities with depositors monies. But look at the three banking giants in the US – JPMorgan (Chase), Citi, and Bank of America. While they certainly had losses associated with subprime and conventional mortgages, they so far are in pretty good shape. Enough shape that JPM picked up Bear Stearns and BofA picked up Merrill. It is the diversification of the revenue streams that does more to protect depositors than FDIC insurance does. And these firms, when times are bad, have a capital base to fall back on. Bear and Lehman did not.

And while it is sad for me to see this chaos happen (I work next door to Lehman’s HQ and I know many a good people there that had to pack their boxes), this is better for the US economy long term. In Japan, the govt there tried to prevent financial instituations from failing after the bubble of the 1980s burst. As a result, the economy was muddled and stagnant for almost 15 years. The Fed and the Treasury, in allowing Lehman to fail, is saying its time for the blood letting to occurr. Credit will be tight for the next 18 months, but the American way of cleaning up the mess and starting anew is occurring. And yes, there will be new regs coming out, that will allow the benefits of trading and packaging assets to occur, but will prohibit the ability to make risky loans based on vapor. But thinking about segregating i-banking and commercial banking again should remain off the table.

Lobbyists and campaign contributors have too much influence, and that has to stop, but the problems we are in have more to do with cultural changes in America. The cultural shifting of America to fuel its growth by credit is a much larger issue than the tools that I-banks used to support that appetite. My mom and dad could afford to live in a small house, and that is what we lived in. They paid off their cars and drove them another 5 years after until the wheels fell off. The thought of going to a car dealership and taking out a loan for 140% of the value of the car b/c you have to wrap your existing car loan is absurd. Shame on banks for having such loan programs, but shame on consumers for taking them out.

We are going to return to a country that has to put 20% down for a house, and will buy a car we can afford. And banks and i-banks will have to operate under a different world. And it will.

He’s not worried :>)

Jim Anchower can spin in his grave

if we are doing any work it completed successfully it need more hardwork

hardwork is power

jockben
California Dui

It’s easy to make a statement minimizing the situation like this:

It’s easy to think that we’re now in the worst financial crisis since the Great Depression.

But if this isn’t the worst financial crisis since the Great Depression, then what was?

I’m not all doom and gloom — there were a lot of mis-valued securities, and it’s going to take a while to shake things out, but we’ll get there — but in my paltry 38 year life, I don’t recall institutions this big failing with this much regularity, or requiring this much government interference.

Was there a greater crisis in the 50′s or 60′s that I am missing? Is there a reason this crisis is not nearly as bad as the 70′s?

where you indicated the problem there had been an assumption that mortgage derivatives were as good as mortgages, but the linkage got broken when somebody tried to collect on some of the derivatives as if they were mortgages and the courts said ‘No.’ Is that still the fundamental driving force in this market? Of am I misremembering what you wrote? I was hoping to find the blog in your diary but it looks like it was on the old site.

I wish more more people and politicians realize how interwoven our economy is to the financial system. I consider all this talk about let’em fail, let the blood flow, no Govt bailouts etc., Mantra don’t seem to realiaze how painful it will be for ALL of us.

There is a credit squeeze and crisis going on and like dominoes there will soon be a CDS crisis. When all of the bonds start defaulting more than just investment banks will go out of business.

You will get hurt If:
you own stocks & mutual funds, have to borrow money for a car, or home on a credit card, want insurance on your car or home.

Some basic facts When you destroy wealth and finance business like this:

Since the start of 2007, the world’s biggest financial institutions have posted almost $515 billion in losses and write-downs. Eleven U.S. banks have collapsed since January 2008 (All tax payer protected).

Buffet had to step in last spring or the Gov’t Bond selling business would have ground to a halt with out huge increases in interest paid. (paid for my local taxpayers).

CDOs and SIVs are being held by a large number of banks and hedge funds. Most are protected by CDSs. If AIG fails like Bush/Paulson/Bernanke fail then the dominoes will continue and many more taxpayer backed systems and institutions will fail.

What happens when foreign investors no longer consider the USA and its business a safe investment.

Our free enterprise system is highly integrated with the flow of capital from abroad and at home.

If you want to see out recession turn into a depression – just let the dominoes continue to fall / collapse.

Instead of the Govt/taxpayer bailing a couple of bad investment banks we could soon be bailing out hundreds of regular banks.

Chevy Chase has commented that he liked the SNL skit about Palin but said it didn’t go far enough. He said he would like to see an encore where they “really decimate her” Typical comment from the Hollywooden heads. I guess he is a bitter man since his own career has gone down the drain. He hasn’t done anything worthwhile since he quit using drugs. If SNL is so cutting edge, like they fancy themselves to be, and willing to explore every taboo and so called “untouchable” subject, then why haven’t we seen a scathing skit about Obama? Who are they afraid of? They are very afraid of bucking hollywood’s obvious agenda of getting Obama elected. SNL used to be cutting edge. Now they, like Chase, have become an empty shell of what they once were and are both totally IRRELEVENT.

LOL

The ether clearly hasn’t worn off yet.
Look at today. All green all good right!!