Is it a good time to buy AIG ( American International Group Inc )?
- Anonymous1 decade agoFavorite Answer
I would say no -- not for investment purposes.
The company is fundamentally insolvent. It remains unclear at this time (1) whether it can emerge at some point without bankruptcy proceedings and (2) how much of a claim the government will place on any remaining assets.
As a practical matter, AIG exists only because of money flows from the federal government & the federal reserve. It is entirely rational to conclude that, for now, the government has a 100% claim on all corporate assets...leaving the common stockholder with 0%. The second crash in price following the reverse stock split suggests that the street agrees with this analysis.