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More on AIG

Last Friday I expressed my anger at the AIG situation.

In the Financial Times last Friday was a much more thoughtful critique of the AIG issue by Willem Buiter, Professor of European Political Economy at the London School of Economics and Political Science.

He calls it “The Fed’s moral hazard maximising strategy.” Indeed it is.

One reply on “More on AIG”

There’s more to the story than meets the eye. I wouldn’t be surprised if the Chinese government was also a beneficiary, and if bailing out AIG’s counterparties was the price for continued Chinese investment in US Treasuries.

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