So, yeah- the auto bailout bill died in the Senate.

I think that the best part of this is that it was the UAW that screwed the auto industry blue once more, by refusing to lower wages before their contract expired in 2011. Because of this, most Republicans refused to vote for the measure.

So now, instead of the UAW members having their jobs at a lower wage there’s a strong possibility that they may lose their jobs completely.

“Total Awesomeness” doesn’t begin to describe my thoughts on this. Well done, Republicans in the Senate. You finally stepped up and did the right thing.

Of course, there’s still the possibility that Bush could decide to give them money from the $700 Billion debacle. But that’s a different fight.

Out.

The FED made a shocking announcement today when they publicly stated that they were offering the largest insurance company in the world AIG an $85 billion bailout package.

American International Group, AIG, will be receiving a federal loan from the Federal Reserve Bank of New York in the amount of $85 billion, in exchange for 79.9% stake in the company. AIG’s assets exceed $1.1 trillion dollars and planned to declare bankruptcy today. If they had, their collapse would have sent world stock markets and financial concerns into chaos.

“[A] disorderly failure of AIG could add to already significant levels of financial market fragility and lead to substantially higher borrowing costs, reduced household wealth and materially weaker economic performance,” the Fed said in a statement.

The Federal Reserve Board will be replacing the company executives, possibly with FED employees, and maintain controlling interest in the company as well as a position on the board of directors. They claim that customers will not notice a difference in this exchange of power.

“Taxpayers will be protected”, the Fed said, “because the loan is backed by the assets of AIG and its subsidiaries. The loan is expected to be repaid from the proceeds of the asset sales.”
“We are working closely with the Federal Reserve, the SEC and other regulators to enhance the stability and orderliness of our financial markets and minimize the disruption to our economy,” said Treasury Secretary Henry Paulson. “I support the steps taken by the Federal Reserve tonight to assist AIG in continuing to meet its obligations, mitigate broader disruptions and at the same time protect the taxpayers.”
AIG’s official company statement is: “AIG is a solid company with over $1 trillion in assets and substantial equity, but it has been recently experiencing serious liquidity issues. We believe the loan, which is backed by profitable, well-capitalized operating subsidiaries with substantial value, will protect all AIG policyholders, address rating agency concerns and give AIG the time necessary to conduct asset sales on an orderly basis.”
“The failure of AIG could have caused unprecedented global ripple effects”, said Robert Bolton, managing director at Mendon Capital Advisors Corp. “If AIG fails and can’t make good on its obligations, forget it. It’s as big a wave as you’re going to see.”