Accentuating the caveat emptor perspective with critical commentary on financial disclosure. I adopt a skeptical persona and look for chinks in the teflon coating of financial disclosure. My job is to identify financial warts. Perhaps a Black Swan. Disclosure: I do not hold positions in stocks mentioned for three trading days before or after blog post.
Monday, December 22, 2008
AIG Fire Sales Hartford
AIG (AIG) sold its Hartford Steam Boiler unit to Germany's Munich Re for $742 million, a steep discount from what AIG paid for HSB in 2000. AIG is under intense pressure to sell off assets to repay government loans and backstops. But if government loans total over $100 billion and prime assets such as Hartford are going for deep discounts are there the assets to effect a recovery? At this rate they will need to sell off the financial equivalent of 135 Hartford styled/sized deals.