Its the end of AIG as we know it. In return for an $85 billion bridge loan (you can buy a hell of a bridge for $85 bln…), the firm will give the US government the right to buy an 80% stake in the company. It sounds almost like they’ve nationalized the company, which makes sense if they are going to have to accept the risk. Absolutely extraordinary.
The dollar is lower in the wake of the news, trading at 1.4200 versus the euro. The JPY is weaker as well, trading at 106.50 and 151.20.
