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24.10.14 1122
The W - Current Events & Politics - This oughta improve the rep of insurance companies...
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Reverend J Shaft
Liverwurst








Since: 25.6.03
From: Home of The Big House

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#1 Posted on | Instant Rating: 0.77
OK, so let's say you're a top-ranking executive at a ginormous insurance company (I know - role-playing Satan isn't easy) and due to mismanagement by you and your other fellow weaselly, backstabbing, soulless execs, your company lost over $13 Bil in 6 months and your stock is worthless.

Now assume the Fed has rode in on its white horse and dumped $85 Bil in your lap. What is your next move? Do you and your fellow ass-spelunkers:

A) Thank heaven that the taxpayers are cleaning up the pile of sh!t you just left and get hard at work turning the business around, or

B) Head to Cali and chillax for a week by spending $350,000 on rooms and meals at a resort and $23,000 in spa treatments?

If you said "B", please send your resume to AIG. You are a straight-shooter with upper-management written all over you.


EDIT: In the interest of fairness (you insurance execs can look that one up in the dictionary) to AIG, their chairman sent a letter to Treasury Sec. Paulson stating the trip was for independent insurance agents and not AIG executives, though 10 AIG employees did attend to "represent the company." Guess we'll have to take his word for it. That last sentence was a joke, by the way.

(edited by Reverend J Shaft on 8.10.08 1238)
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wmatistic
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Since: 2.2.04
From: Austin, TX

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#2 Posted on | Instant Rating: 3.08
After hearing about this last night, I'm still just stunned. I can't believe people would be that stupid. I mean I can, but still. How arrogant and ignorant do you have to be to do that?

It's unreal.
tarnish
Frankfurter








Since: 13.2.02
From: Back in the Heart of Hali

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#3 Posted on | Instant Rating: 7.60
Like everything else, though, the real kicker is that nothing will be done about it except messageboard and politico-blog grousing. For some reason we and our politicians all accept this as something that nothing can be done about (I include Canadians in the "we" there because I have no faith that it would be any different up here).

Edit: I just found this article (consumerist.com). My faith in humanity is...erm...somewhat restored? Maybe not.


(edited by tarnish on 8.10.08 1334)
Oliver
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Since: 20.6.02
From: #YEG

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#4 Posted on | Instant Rating: 3.42
I've never had much faith in the heads of financial companies. This isn't helping.

This reminds me of a time when I worked for a company; and even when the company was in dire straits, everyone would get a company newsletter of the higher ups going out on skiing trips, meetings where white water rafting was the main event.

All the while, I was breaking my back for $8.00 an hour and getting sh*t upon by the idiots taking these trips, claiming whatever. It was enough to get me sick to my stomache, and from what I heard, the company defaulted on peoples' paycheques two months after I left.

A dumb question: where's the bailout for people who have lost their retirement savings through all of this.




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ges7184
Lap cheong








Since: 7.1.02
From: Birmingham, AL

Since last post: 45 days
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#5 Posted on | Instant Rating: 5.84
Wow, they are going to do it again:

http://www.bloomberg.com/apps/news?pid=20601087&sid=aigH2Uop_fSQ&refer=home


    American International Group Inc., the insurer facing criticism for hosting a $440,000 event at a California resort less than a week after a federal takeover, plans another gathering for its brokers at a Ritz-Carlton hotel next week.


I guess when the taxpayer is propping your company up, you don't have to worry about your image.




The Bored are already here. Idle hands are the devil's workshop. And no... we won't kill dolphins. But koalas are fair game.
DrDirt
Banger








Since: 8.10.03
From: flyover country

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#6 Posted on | Instant Rating: 7.85
From 1980 onwards we have moved to deregulate like hell. We essentially told these SOBs that since they handled lots of money they must be smart and crap gold. Responsibilty didn't matter, only showing that big juicy profit. So why are we surprised when the spoiled divas continue to act that way?



Perception is reality
ges7184
Lap cheong








Since: 7.1.02
From: Birmingham, AL

Since last post: 45 days
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#7 Posted on | Instant Rating: 5.84
Apparently in AIG's case (among others), even showing that "big juicy profit" doesn't matter anymore. To be fair to the true pro-deregulation folks, I believe such a person who truly believes in the free market would tell you that this is why companies such as this should be allowed to fail. But you definitely can't deregulate on the one hand and then turn around and intervene to prevent the free market correction on the other.



The Bored are already here. Idle hands are the devil's workshop. And no... we won't kill dolphins. But koalas are fair game.
Guru Zim
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Since: 9.12.01
From: Bay City, OR

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#8 Posted on | Instant Rating: 8.40
You can't make sales without a sales force.

They didn't plan this thing in a week, and I doubt there was a "oh shit we fucked up our company" refund policy.

I'm a bitter shareholder, and I can deal with this.




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Since: 8.10.03
From: flyover country

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#9 Posted on | Instant Rating: 7.85
    Originally posted by Guru Zim
    I'm a bitter shareholder, and I can deal with this.


I am sure you can Guru but why should you and the other shareholders have to cope. If this had happened in spite of management's best efforts it would be one thing, but blatant arrogance and recklessness is another thing.

This is why individuals like myself favor a reasonable level of regulation from government. Ideally, it isn't necessary but the reality is that most every endeavor of humanity goes better when you know there is only so far you can go.

My entire retirment sans SS is in Mutual funds, I was hoping to retire in 8 years. Not any longer.

The worst part of this is that the irresponsible asses causing this drag everyone else down with them.



Perception is reality
Guru Zim
SQL Dejection
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Since: 9.12.01
From: Bay City, OR

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#10 Posted on | Instant Rating: 8.40
AIG must retain a sales force in order to stay in business.

I don't know if you have ever worked with Sales guys before, but extravagant wastes of money to you and I are business as usual in the sales world.

Is this kind of expense common for top sales people in the insurance business? Would ceasing to provide this level of expense at a sales conference encourage your sales force to sell other types of insurance? Are the sales guys already a bit nervous about AIG as it is, so do they need to pull out a few stops to keep them around?

Like it or not, there is a bit of an arms race mentality when it comes to retaining your brokers / salesforce / etc. I don't like that they have to do it, but I'm not going to get up in arms over it without knowing more about whether or not this is extreme for the industry or if AIG even had the option to cancel it just one week after the bailout.




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Since: 8.10.03
From: flyover country

Since last post: 1 day
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#11 Posted on | Instant Rating: 7.85
    Originally posted by Guru Zim
    AIG must retain a sales force in order to stay in business.

    I don't know if you have ever worked with Sales guys before, but extravagant wastes of money to you and I are business as usual in the sales world.

    Is this kind of expense common for top sales people in the insurance business? Would ceasing to provide this level of expense at a sales conference encourage your sales force to sell other types of insurance? Are the sales guys already a bit nervous about AIG as it is, so do they need to pull out a few stops to keep them around?

    Like it or not, there is a bit of an arms race mentality when it comes to retaining your brokers / salesforce / etc. I don't like that they have to do it, but I'm not going to get up in arms over it without knowing more about whether or not this is extreme for the industry or if AIG even had the option to cancel it just one week after the bailout.


Only in the agricultural sector and they have spent the last decade consolidating companies and eliminating jobs (mostly older farts like me). These guys used to get perks but nothing like AIG or other big boys. Mostly, many of them are always lloking over the shoulder to see if they still have a job.

Having worked for universities since 1975 first as a janitor working to get my BS, then as a research technician, graduate research associate and finally a professor, I can't relate on a personal level. I am not complaining but we don't have any of this crap.



Perception is reality
Corajudo
Frankfurter








Since: 7.11.02
From: Dallas, TX

Since last post: 107 days
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#12 Posted on | Instant Rating: 7.73
    Originally posted by DrDirt
    Having worked for universities since 1975 first as a janitor working to get my BS, then as a research technician, graduate research associate and finally a professor, I can't relate on a personal level. I am not complaining but we don't have any of this crap.

Maybe not this crap, but there's a different type of crap (and arms race) in academia. Endowed, chaired, big name profs who pull down big bucks from the university but don't really work many hours for the school, and what time is spent on campus largely consists of doing consulting work for even bigger bucks. Should class and the other job conflict--guess who wins. The relative importance assigned to research over teaching in most institutions. The importance of pedigree, even deep into someone's career. Teaching two-three classes annually (which the person has been teaching for years) is considered full-time work. The whole idea of tenure.

There are a lot of things in academia that look weird to the outside world-- I'm oversimplifying, but my guess is that every field has things that, from the outside, look bad. Even when there is a rational explanation for them.
DrDirt
Banger








Since: 8.10.03
From: flyover country

Since last post: 1 day
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#13 Posted on | Instant Rating: 7.98
    Originally posted by Corajudo
      Originally posted by DrDirt
      Having worked for universities since 1975 first as a janitor working to get my BS, then as a research technician, graduate research associate and finally a professor, I can't relate on a personal level. I am not complaining but we don't have any of this crap.

    Maybe not this crap, but there's a different type of crap (and arms race) in academia. Endowed, chaired, big name profs who pull down big bucks from the university but don't really work many hours for the school, and what time is spent on campus largely consists of doing consulting work for even bigger bucks. Should class and the other job conflict--guess who wins. The relative importance assigned to research over teaching in most institutions. The importance of pedigree, even deep into someone's career. Teaching two-three classes annually (which the person has been teaching for years) is considered full-time work. The whole idea of tenure.

    There are a lot of things in academia that look weird to the outside world-- I'm oversimplifying, but my guess is that every field has things that, from the outside, look bad. Even when there is a rational explanation for them.


I don't disagree but a couple of points. Endowed chairs are just that, endowed. They do not use student fees or tax dollars but monies given by private individuals or groups. Tenure in many places is really a myth. Her if we receive two "Fails to meet expectations" evaluations in a row, we are gone, tenure or no. And evaluations are very subjective.

I agree re the teaching vs. research dilema. But since funds are tight, research confers status to the institution, and it is publish or perish, research is first and foremost as it brings all these things. Don't agree but that is the way it is.

And yes colleges/universities are a strange place to outsiders (or insiders). That is why I am in extension and three hours from the main campus.



Perception is reality
Corajudo
Frankfurter








Since: 7.11.02
From: Dallas, TX

Since last post: 107 days
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#14 Posted on | Instant Rating: 7.73
The only minor quibble would be that the endowment does represent some use of tax dollars because it's deductible. But, that's minor. I straddle both worlds because I also am an adjunct (scab). So, even thought there's some level of nonsense at universities, it's just a different type of b.s. than you find in the private sector which is my only point.
Guru Zim
SQL Dejection
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Since: 9.12.01
From: Bay City, OR

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#15 Posted on | Instant Rating: 8.40
Technically, they are using a loan from the government - with a steep repayment plan.

Assuming they repay it, why should we care? Does this behavior make them more or less likely to repay, that should be the question. We shouldn't just jump up and judge.

I'm still holding what few shares I have, so time will tell if I'm an idiot or not.




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Since: 8.10.03
From: flyover country

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#16 Posted on | Instant Rating: 7.79
    Originally posted by Guru Zim
    Technically, they are using a loan from the government - with a steep repayment plan.

    Assuming they repay it, why should we care? Does this behavior make them more or less likely to repay, that should be the question. We shouldn't just jump up and judge.

    I'm still holding what few shares I have, so time will tell if I'm an idiot or not.


Guru, IMHO, you should care because it proves they learned nothing. At the very least, they learned nothing about PR.

And quite honestly, many people at this level who think their being bailed out is great for the country and proper are also the ones who disparage those on government programs because of the way the poor waste the money they are given, and think they should pay lower (or no) taxes and we could if we just eliminated waste. Waste like $400 k for a retreat?

And it may technically be a loan but c'mon guys. I agree these things had to be done but the people who reaped the benefits when at the top during the good, get to also reap the bad. Like the rest of us.



Perception is reality
tarnish
Frankfurter








Since: 13.2.02
From: Back in the Heart of Hali

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#17 Posted on | Instant Rating: 7.59
    Originally posted by Guru Zim

    Technically, they are using a loan from the government - with a steep repayment plan.

    Assuming they repay it, why should we care? Does this behavior make them more or less likely to repay, that should be the question. We shouldn't just jump up and judge.



Assuming they repay it. I hardly consider that fait accompli; and it's harder to believe they learned anything from this whole situation watching them drop a million here and a million there to pat themselves on the back at a resort, the kind of resort their average sub-prime customer will only ever see in travel brochures.

And where is the government getting the money they're loaning? From your children, and your children's children, and with the amount going out, probably your children's children's children as well.

I know that practically every country in the world is still in some kind of debt and that much of it goes back to WWII. But to me the worst part about the bailout is that everyone's worried about themselves in the present and not the next generation(s) that will have to live with the repercussions. Unless the new dream is "Mine. Now!" instead of "My children will be better off than I was."
DrDirt
Banger








Since: 8.10.03
From: flyover country

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#18 Posted on | Instant Rating: 7.79
    Originally posted by tarnish
    But to me the worst part about the bailout is that everyone's worried about themselves in the present and not the next generation(s) that will have to live with the repercussions. Unless the new dream is "Mine. Now!" instead of "My children will be better off than I was."



While it will indeed affect our children's children, I don't think you are being quite fair. Most realize what all this means (those that would care in any case)but right now are just trying to get a handle on it. Those that don't understand wouldn't have no matter what happens. It has been that way for all of human history. But for right now people have more immediate, if shortsighted, concerns.



Perception is reality
Guru Zim
SQL Dejection
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Since: 9.12.01
From: Bay City, OR

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#19 Posted on | Instant Rating: 8.40
AIG was an insurance company, not a bank. These people that they were treating were the independent insurance agents - the people that are face to face with clients and have to say "Don't change to a different insurer - here's why". You want those people to believe that things are OK.

AIG was a trillion dollar company that borrowed 86 billion. It's up to around 120 billion now. The government owns 80% if they get to take advantage of the warrants.

Anyway, I'm just saying this incident isn't what pisses me off. Lying to shareholders about capitalization is far worse than this. Just don't get fired up by issues that are taken out of context. I believe these "excesses" are probably not that far out of the norm for the industry and were probably a necessary expenditure, no matter how crazy they seem to us normal folks.




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