Many people are missing the bigger picture here with AIG. Both AIG and Lehman were heavily involved in the trading of unregulated Derivatives...These Derivatives have an outstanding balance of approx 62 Trillion dollars... This is an absolutely mind boggling amount of money...Basically AIG does not have enough money to back up it's bets. My question..does anyone? We are speaking about 62 Trillion Dollars..

AIG accepted an $85 billion federal loan and gave the U.S. government a majority stake yesterday, averting the worst financial collapse in history ( Supposedly) The Federal Reserve stated that ``a disorderly failure of AIG could add to already significant levels of financial market fragility.'' Lehman filed the biggest bankruptcy in history on Sept. 15. The US govt is now in the insurance business with a loan to AIG for 2 years at 11%. What happens if AIG can not pay due to it's abhorent derivative exposure. Who will pay the bill? Who will bail out the US govt. In just common logic ..how can the fed keep on lending. Is it like putting a finger in the dam and trying to keep the water out. What is notable is that the central banks are not making any panicky rate cuts.. Your call? Good or Bad???

The US is surely not alone... The vibrations are being felt worldwide... All the Swiss reinsurers..The insurance industry is rocking from Singapore to the US and back again... England has had it's biggest monthly increase in unemployment since 1992... CBI orders are weakening.. The Europe zone trade deficit is widening... Is AIG too big fall?? Is the US Fed to big to fall...

We are in interesting times... So far we have not taken out the July 08 lows on the SP 500.. Time will tell..

Andrew Abraham
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