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In the video contained in this article, former AIG CEO Hank Greenberg comments on the future of AIG. He claims the best move is to continue to fund the recovery of AIG so they can make money to repay the taxpayers, rather than selling off the vital parts of the company. He also says that it wasn't lack of regulation that led to the crisis but rather lack of enforcing regulation on the part of the regulators. What do you think?
http://money.cnn.com/2010/05/24/news/companies/aig_probe/index.htm
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I disagree with Greenberg's comments. If it was so easy for companies like AIG to get around the regulation that was in place than it obviously wasn't effective and there needs to be reform. Obviously the CEO does not want regulation that will hurt his company in the short run but in the long run proper regulation would make the whole economy more efficient.
ReplyDeleteOn a lighter note, today is Ashlee's birthday and if you have a chance make sure to wish her a Happy Birthday!!
I agree with Greenberg's comment that regulation/ too big to fail cannot be selective. It is unfair to make policies that only apply to some companies and not others. However, he is far too eager to blame the regulators for his companies problems. He obviously does not want increased regulation because it would negatively affect his former company. Therefore, he blames any issues on the current regulators not doing their jobs instead of their lack of policy as well as power/ enforcement ability.
ReplyDeleteI think since there is so much money already committed to the rebuilding of AIG we should follow through and allow for it to happen. If we cut and run now we're likely to lose much more from not getting paid back then if we put a little more money into it to ensure the loan gets repaid. On the other side of things I think it was unfair of him to blame the regulators, because the way the system was set up it was impossible for the regulators to read into what was really going on.
ReplyDeleteI think that we need to finish the rebuilding of AIG. I do think we have some regulations, but definitely not enough. We need to add regulations and definitely enforce them much more strongly than before.
ReplyDeleteMy question is that there doesn't seem like there was any, or very little regulation, so what would there have been to enforce? AIG is blaming it on the lack of enforcing regulation, but there didn't seem like there was any regulation to enforce. Basically we do need more regulation.
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