Vincent Gioia - April 3, 2009

AIG has been in the news a lot these days. At the beginning of the AIG saga the Fed said it was too big to allow it to fail and so billions were given to “save” the company. Of course this failed and still more money was thrown their way. When it was “discovered” that AIG had contractual obligations to give serious bonuses to key employees, congress was irate. Even after it became known that a Democrat, Senator Chris Dodd, inserted a provision in the Stimulus bill to protect these bonuses at the request of the Treasury Department, the jackals that passed, but didn’t read, the bill were still furious.

With all the attention given to AIG I think it is interesting to learn a little more about the company.

First of all, some may be surprised to learn that AIG is a subsidiary of American International Corporation (AIC) and the parent has a most interesting history. AIC has succeeded in remaining invisible and does that by relying on secrecy because that’s how its founders liked it. John D. Rockefeller, Sr., of Robber Baron fame, started the company in 1910. Other Barons of industry joined John D.; Andrew Mellon, J.P. Morgan, and Andrew Carnegie. Other American industrialists and bankers also joined the AIC venture. The reason such an illustrious group of giants came together was that knew the financial clout they could exert together would bring them even more wealth, but more importantly, power; at a time when there were few government restrictions interfering with business.

Full story

F. William Engdahl - September 30, 2008

The unexpected rejection by the US Congress of the Bush Administration financial rescue plan, TARP on September 29 has opened up the spectre for the first time of a 1931-style domino wave of worldwide bank failures. That is already underway across the US banking spectrum with the failure, nationalization or forced liquidation in the past two weeks of Fannie Mae and Freddie Mac, of the giant Washington Mutual mortgage lender, of the nation’s fourth largest deposit bank, Wachovia. That was on top of a wave of smaller bank failures that began with IndyMac in the spring. For some it is appealing and more simple to grasp the magnitude of these titanic events in the US-centered financial world by assuming it is all part of a pre-planned grand conspiracy by the Money Masters, what in the 1920s in the USA was termed the Money Trust, to control the entire financial world.

As the details of the present crisis reveal, there are huge ideological fault lines making for chaos and a potential meltdown of the Laissez Faire financial system. That present system, which was built on the back of Wall Street financial and banking deregulation since 1987 when Alan Greenspan, a devout follower and close friend of radical individualist Ayn Rand, became Wall Street’s man at the Federal Reserve for almost 19 years, is over now with the failure of the Henry Paulson $700 billion bailout scheme. Governments worldwide now face no alternative but to begin the painful process of putting the financial genie back in the bottle and re-regulating an out-of-control financial system. The failure of the UK Government and the US Government to address that fundamental issue is behind the present crisis of confidence.

A brief look at history

The Great Depression in Germany in 1931 began with a seemingly minor event—the collapse of a bank in Vienna, Creditanstalt, that May. For readers interested in more on the remarkable parallels between that crisis and that of today, I recommend the treatment in my earlier volume, A Century of War: Anglo-American Oil Politics and the New World Order.

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