$85 Billion Bailout for AIG

Well to be honest I did not see this coming. Its getting scary out there. I still think that the market will hold until after the election but after the election is done with and Obama is in office. The Market will Crash. I mean Crash. Not sure how to explain that better. Take this quote for instance from Don on Active Rain.

“People are now comparing current events to the last depression so what does the 1929 stock market chart say will happen now. The 1929 chart says that the stock market will NOW crash…We have just read that there is great concern Goldman Sachs may go under caused by a proliferation of failing banks. Henery Paulson, the current Secretary Of The Treasury came from Goldman Sachs.”

On the plus side if you have the money I would recommend buying up rental property. Maybe even apartment complexes. People will not be able to get financed to buy a house soon. Maybe some people in the higher up markets 200k+ but I’m not even sure about them. Vacancies are going to fall through the floor. Its going to get tough to find a place to rent . If you own those properties you will be making steady cash flow each month. That will be a major plus since unemployment will go through the ceiling.

“The Federal Reserve said Tuesday night it would lend up to $85 billion to flailing insurance giant American International Group, saying the move was necessary to protect the financial system.”

You Can Read the whole article here.

You Can Read Don’s blog here.

Vizionkc.com

— Justin of Vizionkc

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2 responses to “$85 Billion Bailout for AIG

  1. The Fed had no choice, they had to bail AIG, if not, the consequences would have been very severe for many businesses including banks.

    There is, however, a strong case, once the dust has settled, for an investigation into how this was allowed to happen. Senior managers should be held to account for their actions and decisions and there needs to be enforced regulation to ensure that it doesn’t happen again.

    Not only can American tax payers expect to pay for the largesse of AIG staff, they will also feel the pain through their own pension funds, which have seen massive falls.

  2. UK Voter — You make a good point. But I still think that this is only a short term solution. In the long term the financial system will still collapse. Nothing has been solved. These bailouts are highly inflationary. In fact its because of these bailouts that I feel hyper inflation is imminent. Thanks for your comment it is much appreciated.

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