From Bloomberg By Andrew Zajac and Christie Smythe
...In consideration for an $85 billion LOAN FROM the Bank of New York , the insurer had to agree to a 14 percent INTEREST RATE and a demand for an 80 percent government equity stake, arrangements that cost shareholders as much as $40 billion, Greenberg claimed. Led by attorney David Boies, Starr’s lawyers argued AIG investors deserve that money back.
The AIG bailout ballooned to $182 billion. The New York-based insurer eventually returned to profitability and repaid the assistance in 2012, leaving the government with a $22.7 billion profit.
In the trial, the U.S. argued that it had authority to demand equity, and that the bailout was voluntarily agreed to by AIG’s board as a preferable alternative to BANKRUPTCY.
Boies, 73, has used government correspondence to argue that, instead of being a hedge against risk as U.S. lawyers argued, the stiff costs of THE LOAN were an attempt to make money.
Much of the case has focused on Starr’s allegations that the government coerced AIG’s board into accepting the bailout, and EXERCISED control of the company at key moments afterward.
Those elements are crucial to Starr’s claim the government took shareholders’ property without just compensation, in violation of the U.S. Constitution.
Wheeler gave both sides until next week to finish submitting evidence, including material from the trove he forced the government and others to produce. He set a Feb. 9 deadline for both sides to file conclusions of law, with closing arguments to follow as soon as March.
Indicator built by Lazy Bear COG SQZ shows us where there is a possibility of a price break out and future volatility. Here we had a miss fire, but that's usually a good sign. If you see another similar sqz signal that is held up at an important area of resistance or support, there's a very high probability of both future volatility and price swing. This indication would make sense. Investors do not want to get involved with AIG, because there is a chance that AIG has to foot some or all of the bill that Greenberg is demanding.