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Of course, days after it's first bailout, AIG execs treated themselves to a $440,000 weekend at an exclusive spa. Wonder what's up for this weekend.

I heard they did actually have another trip planned.

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Holy Crap.

 

JD Power is talking about a "total collapse" of the auto industry in 2009 with virutally every market worldwide contracting. New car dealer numbers here in the US may contract by 5%.

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AIG cancels conference at resort amid inquiry over expenses

 

Bloomberg NewsPublished: October 9, 2008

 

 

 

NEW YORK: American International Group scrapped a seaside conference at a California resort amid a barrage of criticism for spending $440,000 on a similar event days after getting an $85 billion U.S. government bailout.

 

AIG canceled the conference at the Ritz-Carlton in California's Half Moon Bay "after a re-evaluation of the costs under the new circumstances," said a spokesman, Joe Norton.

 

The Senate Finance Committee chairman, Max Baucus, on Thursday demanded more details from the Federal Reserve on AIG's event last month, including "who we can fire."

 

"This kind of behavior is an insult to taxpayers," the Montana Democrat wrote in a letter to the chairman of the Federal Reserve, Ben Bernanke. He asked for a response by Oct. 23.

 

Events such as those hosted by AIG to reward top salesmen are common at financial firms. Wachovia, the lender in talks to be acquired after losing $9.5 billion this year, is sending 75 brokers and their spouses on a cruise to the islands of Greece this weekend, a bank spokesman, Jim Griffin, said, confirming a report earlier in the Los Angeles Times.

 

"Incentives for sales departments have proven over time that they work, and that's true in every business that depends on the selling effort," said Dean Bare, managing director of Stanton Chase International, an executive search firm. "If these trips didn't work, they would have stopped doing them a long time ago."

 

Even so, perceptions matter, said Heather Elms, a business professor at the Kogod School of Business at American University in Washington. "Whether the company's behavior is wrong on an absolute basis doesn't really matter right now," she said. "It seems that they're being viewed as behaving unethically."

 

AIG's event next week aimed to "motivate and educate" about 150 independent agents who sell AIG coverage to high-end clients, a spokesman, Nicholas Ashooh, said Wednesday. The insurer hosts similar conferences "around the world all the time," he said, to reward self-employed agents. Norton said Thursday that he did not know whether AIG would cancel other such plans.

 

A spokeswoman for Ritz-Carlton, Vivian Deuschl, declined to say how much AIG would pay to cancel. Companies typically forfeit a deposit of half the estimated cost of a conference if they cancel close to the date, said Anne Bodnar, who organizes similar gatherings for financial clients for Intermarket Communications in New York.

 

AIG reversed itself on the conference a day after striking an agreement that would enable it to access an additional $37.8 billion from the Federal Reserve Bank of New York. The chief executive, Edward Liddy, told Treasury Secretary Henry Paulson Jr. on Wednesday that the company would rethink expenses.

 

"I cannot fathom how in the same day - the very same day - that AIG asked the government for another $37.8 billion loan, the company would even consider moving forward with plans to host another large conference at another luxury resort," said Representative Elijah Cummings, a Maryland Democrat who criticized AIG this week for the cost of its gathering the St. Regis resort in Monarch Beach.

 

White House spokeswoman Dana Perino yesterday called "despicable" expenses from St. Regis event. Those costs included $23,000 for spa services, according to Representative Henry Waxman, chairman of the House Oversight and Government Reform Committee.

 

AIG considered buying advertisements to explain its position, only to be told by its public-relations consultant, George Sard, that it would be "a really bad idea."

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Is it at all possible that the market might improve if folks were to shut off their televisions and stop clicking on CNN.com compulsively?

 

In a way, YES. Alot of the downfall of the stock market is panic selling. Some companies will fall and go out of business, but there are companies that are sound and good that are losing value because of the panic. The biggest sale on stocks is going on now.

 

If you are invested in long term, DONT SELL. Thats the worst you can do.

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If you are invested in long term, DONT SELL. Thats the worst you can do.

 

My brother is a market timer. His indicators suggested we sell 3 weeks ago, which we did. His point is that you should never lose capital if you don't have to.

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My brother is a market timer. His indicators suggested we sell 3 weeks ago, which we did. His point is that you should never lose capital if you don't have to.

I agree with this if you can buy back in at a bargain (like now). Most people won't/can't pay that close attention though. Well-managed mutual funds are probably the best way for most folks to do what you did.

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My brother is a market timer. His indicators suggested we sell 3 weeks ago, which we did. His point is that you should never lose capital if you don't have to.

 

 

I am saying long term. If you are playing short term, its different. You dont lose unless you sell at a loss. If you sold at a loss 3 weeks ago, you lost.

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