Yet another bailout

So AIG is the next bailout. I guess some of the preferred stock holders in AIG had a more powerful presence in government than Lehman Brothers did. This bailout is basically a loan by the government (using your tax dollars) so that AIG can go out of business in an orderly manner. Here is choice a quote by Tami Luhby, a senior writer at CNNMoney.com:

An eventual liquidation of the company is most likely, senior Fed officials said. But with the government loan, the company won't have to go through a tumultuous fire sale.

(for the CNN full article click here)

So what happens in such a liquidation? Well the bulk of the proceeds in the liquidation go, of course, to the preferred stock holders (the wealthy elites) while the regular stock holders (you, through your 401k) get the shaft. And of course, the management of AIG (more wealthy elites) can always take that loan money and run, let the corporation default on the loan. In other words, they will just mail the keys to the office to the Federal Reserve Board a corporate version of jingle mail.

I smell bailout!

So will Lehman Brothers be deemed to big to fail? According to Reuters:

Shares of Lehman (LEH.N: Quote, Profile, Research, Stock Buzz), the fourth largest U.S. investment bank, fell 44 percent to $7.91 on the New York Stock Exchange.

I believe I see another opportunity for some fat bankers and their preferred-share-holders to snag some federal tax revenue. I suppose it depends on how many of those preferred-share-holders are neocon elites whispering into the President's ear.