Here is a BIG REASON to let AIG Fail.. ( at least the credit derivatives part).
The Fed should separate the regular insurance portion of AIG and kill the Derivatives side...
The rationale is that all money given to this business will be channeled to the banks that purchased these products. As we could see from yesterday's disclosure- a good portion of that money goes to foreign banks..
SO
The money that would have gone to AIG - can now be used to prop US banks..
Sounds protectionist -- But when your house is on fire - I think it is common sense that you will try to douse the flames on your house rather than your neighbors ( There is no Fire Dept)
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