David Goldmann
12th March, 2009
What happens if insurance policyholders lose confidence in their provider and cash in their policies? It’s a run on the insurance industry, same as a run on the banks — except the regulators have no obvious mechanism to stop it. This could blindside the system in a big way. The academic tinkerers (Roubini, Krugman) who propose nationalizing the banks and haircutting their debt didn’t think about this one. But AIG did. An AIG presentation to Congress on the consquences of its failure was posted today on the Financial Times “Alphaville” blog. It is one of the more entertaiing things to circulate in the course of the crisis.
In These New Times 