AIG (NYSE: AIG, Stock Forum) probably has the wrong management in place. A retired CEO from Allstate may not be the man. The insurance company lost another $24.47 billion in the third quarter.
The current plan at the damaged insurance company is "if at first you don't succeed, try, try again". It is the American character never to give up on something that has be started, no matter how futile the cause. The U.S. government's financial rescue program has a bit of that spirit in it. Regardless of how bleak a large insurance company or bank's prospects may be, the Treasury and Fed are prepared to barrel ahead.
One reason that giving up on troubled financial companies seems to be a bad idea is the lesson of Lehman Brothers. As it fell, it damaged large numbers of firms that held its paper.
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Copyright 2008 Stockhouse
