Remind me again; who was supposed regulate the American insurance company AIG? It is difficult to understand how one company seems to have the potential to destroy the international capitalist system. Bloomberg today provided a stark assessment of the destructive capacity of this firm:
American International Group Inc. appealed for its fourth U.S. rescue by telling regulators the company’s collapse could cripple money-market funds, force European banks to raise capital, cause competing life insurers to fail and wipe out the taxpayers’ stake in the firm.
Meanwhile, Reuters reports that European banks are keeping suspiciously quiet about AIG:
European banks declined to discuss a report that they were beneficiaries of the $173 billion bail-out of insurer AIG that has sparked political furor in the United States.Goldman Sachs, Morgan Stanley and a host of other U.S. and European banks had been paid roughly $50 billion since the Federal Reserve first extended aid to AIG, the Wall Street Journal reported on Friday.
French banks Societe Generale and Calyon on Sunday declined to comment on the story, as did Deutsche Bank, Britain's Barclays and unlisted Dutch group Rabobank.
If only we could turn the clock back, imagine how much regulation there would be.