Former AIG (AIG) Chief Executive Hank Greenberg has won a landmark lawsuit against the U.S government but he and his shareholders will not be offered any compensation. Greenberg claimed that the government overstepped its authority by demanding AIG stock during the company's 2008 bailout. Federal Judge Thomas Wheeler concluded that: 'The government's unduly harsh treatment of AIG in comparison to other institutions seemingly was misguided and had no legitimate purpose.' But though the government may have over stepped its authority, Wheeler said, shareholders were not, as a result, legally entitled to any financial compensation. He added that if the government hadn't intervened, AIG would have been left bankrupt and shareholders would have lost everything. During the financial crisis the U.S. government provided the insurance giant with an $85 billion bailout loan in return for a $79.9 percent equity stake in the company and repayment at a 14.5 percent interest rate. The court decreed that the government's actions violated Section 13 (3) of the Federal Reserve Act. The Government countered the law suit, claiming that because the loan was a high risk one, their demands were reasonable. Following its bailout, AIG swung back into profit, paying back the loan by 2012 and leaving the government with around $22.7 billion of profit from the AIG deal terms.
More from Video
How quickly do we find support, is what we'll want to know now, as the correction is occurring while economic optimism builds.
Despite the president's promise of no stimulus until after Nov. 3, there are no signs yet that this is the sort of correlated selling that leads to a deep correction.
Salesforce, Amgen and Honeywell will give a lift to the DJIA going forward.
CAG has hung onto the bulk of its recent gains, and could rise to the $50 area, according to the charts and indicators.