Security

Finance


security

investment in a company or in government debt which can be traded on the financial markets and which produces an income for the investor (= someone giving money hoping to get more back)

AIG Warned of 'Catastrophic' Failure

On the eve of its latest bailout, American International Group warned U.S. government officials that it needed more help from the Treasury Department and the Federal Reserve to prevent "potentially catastrophic unforeseen consequences."

In a 21-page draft presentation, dated Feb. 26 and labeled "strictly confidential," company officials painted a grim set of possible scenarios, cautioning that its failure would cause a "chain reaction of enormous proportion."

The collapse, for instance, would strain the global insurance industry, hurt the value of the dollar and damage money-market funds, AIG warned. The company's failure, it added, would also erase taxpayers' existing investment in the firm and foster "doubts about the ability of the U.S. to support its banking system."

On March 2, the government announced that it would ease the terms of its existing loans to AIG and give the struggling company access to an additional $30 billion, raising the total rescue package to an estimated $170 billion. That same day, AIG posted a $61.7 billion loss for the fourth quarter of 2008, the largest such loss in U.S. corporate history.

The presentation "reflects months of dialogue between the company and various people in the government, really trying to understand the systemic risk," said an AIG official, who was not authorized to speak on the record.

Article Source: http://www.washingtonpost.com/wp-dyn/content/article/2009/03/09/AR2009030902806.html

Hu, Bush talk over phone about US financial turmoil

BEIJING -- Chinese President Hu Jintao and his US counterpart George W. Bush discussed bilateral relations and the financial upheavals in the United States in a phone conversation on Monday morning Beijing time.

Bush congratulated Hu on China's successful hosting of the Beijing Olympic and Paralympic Games and thanked China for its hospitality toward him when he was in Beijing to attend the Olympics. Hu appreciated the US government and people's support for the Games.

Bush briefed Hu on the latest development of the US financial market, saying his government was well aware of the scope of the problem, and had taken and would continue to take necessary measures to stabilize the domestic and world financial markets.


Hu hoped the measures would soon take effect and lead to a gradual recovery of the financial market, which he said not only serves the interests of the United States, but also those of China, and benefits the stability of the world financial market and the sound development of the world economy.

The Chinese president also praised the good momentum of the development of the Sino-US ties in recent years in various areas.

He said China is ready to work with the US side to intensify dialogue, exchanges and cooperation, and properly handle issues concerning mutual interests and and of major concern, particularly the Taiwan question, in a bid to push forward the sustained and steady development of the Sino-US constructive and cooperative ties.

Article Source: http://www.chinadaily.com.cn/china/2008-09/22/content_7047067.htm