Wikinvest Wire
Monday, April 11, 2005
Lemme See If I Have This Right?
The Spitzer Posse wants to know about finite reinsurance that General Re sold to AIG. So instead of calling in the person that sold the product to AIG or the salesperson's immediate supervisor they call in the CEO of the parent company? Am I alone in thinking this is not the most direct path to the truth?
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8 comments:
Roger,
The truth is not the principal issue here, who the next Governor of New York is.
JimN
LMAO
I know why GenRe sold the policy, they made $.
I don't know why AIG wanted to buy the policy. Was the goal to transfer risk or facilitate accounting?
The legal issue appears to revolve around accounting vs risk transfer, and that is an AIG issue. So Spitzer should talk to AIG folk, presumably they know why the did what they did.
GenRe may have some perceptions as to why AIG did the deal, but discussion with them can't be conclusive unless they can point to an AIG/GenRe paper trail.
"Govenor Spitzer, the President calling for you on line 1"
I think the comments take far too narrow a view. If Warren Buffet, one of the biggest investors in the world, knew that AIG was rigging its books, it's highly significant and well worth pursuing. Clearly he had to approve a deal of this magnitude and with this many potential implications.
i may be naive or dumb but i would be surprised that it would go to him with detail but i could be 100% wrong.
let me stipulate first:1) I haven't studied the AIG/ Gen Re deal much at all, 2)I'm as suspicious of Spitzer's motives as anyone, 3) I would be surprised if Buffett were involved in something shady.
That being said, Buffett has made a point in the past of knowing the details of big reinsurance deals that Ajit Jain worked out for Berkshire. If it was a big deal, it's worth asking Buffett what he knew about it. Without knowing anything else, it's not inconceivable that this was a "Hank to Warren" deal.
On further reflection, the explanation for the whole thing came to me in a flash. Since I think I have a novel insight, I posted it over at my site, http://jaloti.blogspot.com/2005/04/buffett-vs-spitzer.html
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