In Response: A.I.G. May Seek Federal Backstop, Report Says (#9)

A federal backstop will help the company flourish, but is it worth the risk for investors to reinvest? AIG is going to try to sell most of their assets, and rebound with the funds that they receive. I guess that the question at hand is whether or not it is wise to reinvest with the now "new" AIG. Did they learn their lesson? Will they default to subprime lending again? It is these questions that will determine if the company flourishes yet again, or dies on the vine.

A.I.G. May Seek Federal Backstop, Report Says (#9)

This article talks about how AIG is looking for a "federal backstop for some of its assets" so the company may become more independent from the government.

"A.I.G. is also considering selling units through public offerings" this quote suggests that in order to regain its stature, the company needs to start to sell some of its assets including shares in other businesses, and other companies. AIG is hoping that by selling the vast amounts of assets it holds, they will generate enough revenue to become fully independent.

"Backstopping the insurer’s assets would be similar to guarantees the government provided for assets belonging to Citigroup and Bank of America, The Journal reported." AIG is looking for the same freedoms that Citigroup and Bank of America have, and by receiving the federal backstop this could be ascertained.