Federal Reserve lends AIG an additional $37.8 billion
CHARLOTTE — The Federal Reserve on Wednesday agreed to provide insurance giant American International Group (AIG) with a loan of up to $37.8 billion, on top of one made to the troubled company last month.
Under the new program, the Federal Reserve Bank of New York will borrow up to $37.8 billion in investment-grade, fixed income securities from AIG in return for cash collateral. These securities were previously lent by AIG’s insurance company subsidiaries to third parties
Almost $120 billion dollars to one company? How did this happen and where was the oversight? Why didn’t the government intervene earlier when the alarm bells first went off in the financial sector?