AIG Share Price

BusinessWeek has an interesting coverage on Where AIG Went Wrong:

The primary job of an underwriter is to spread risk around. In making bold bets on home prices, AIG left its business exposed to one terrible turn of events and is paying a steep price. For taxpayers, the question is how deep the mess can get?nd how long it will take AIG to get out of it. Then there’s the issue of whether $85 billion is enough to do the trick. The government has taken a bigger stake than is typical in bridge loans, experts say, exposing it to the risks of a company whose capital needs have been escalating. “I don’t think anyone really knows the risks” says Vickrey. “If they say they do, they’re fibbing.”

Morale of the story: Even big companies can get into plastic problems! Even with today’s sophisticated technology to help us crunch numbers and data, it seems that the human element is constantly and will always be an unknown risk. The lust and greed for more profits, without considering the risks involved can be deadly.

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