Revisiting brand new AIG Bailout
Personally, the brand new bailout of one’s AIG insurance carrier back into always endured out from the other bailouts to that point. If bailing aside large banks are an essential step or not, at least it had been noticeable why the banks was in fact in trouble: housing pricing got decrease greatly, and you can lots more somebody than just requested was failing woefully to pay back their mortgage loans. Similarly, it was obvious your clear drop from inside the houses costs you are going to lead to serious difficulties to own Federal national mortgage association and Freddie Mac, the 2 most significant federal enterprises that have been to buy mortgages, bundling them to one another, immediately after which reselling all of them. Continue reading “But the borrower of bond places dollars as the equity with the lender, in cases like this AIG”