Today the US government announced an 85 billion dollar rescue plan for the stricken AIG Company. AIG is America’s largest insurance company and has been struggling since the US housing market crash.
The Federal Reserve’s bailout plan comes after the US investment bank Lehman Brothers filed for bankruptcy, causing the stock markets to plummet. The rescue plan will loan AIG $85bn in return for an 80 percent stake in the company.
Analysts are hoping that this latest move by the Federal Reserve to bailout AIG will help to stabilise the financial markets, which have been plummeting after the recent news of Lehman Brothers bankruptcy and the government takeover of Freddie Mac and Fannie Mae.
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