Just read the news that the Feds bailed out the ailing AIG by lending 85 billion dollars. Before this, it did the same for Bears sterns, the question that's been lingering at the back of my mind is how justified is the government in doing this with the tax payers money? and that too for companies who have made bad investment calls, doesn't it set a bad precedent of sorts where the banks hereafter can go into risky transactions where if it pays of, well and good but if it doesn't won't they look at the fed to come bail them out.
A much more relevant question in regards with India is do they continue with deregulaization of banking & Insurance sectors or after seeing the US experience re-evaluate their policies?
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3 comments:
Most of the Banking and Insurance sectors are owned by private players right? and anyway our Govt is not in a position to bail out any Banking or insurance company if they fall out :O
@ tp
are you crazy or what?? most of the banks and insurance companies are owned by the state in India and even the private players like ICICI and AXIS are heavily regulated by RBI and the same for insurance companies like TATA AIG and their ilk by IRDA. Actually in Insurance sector the max FDI allowed is 26%. And don't underestimate RBI, it is one of the important central banks in the world right now.
Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.
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