Fed Chief Says Insurance Giant Acted Irresponsibly

In a Congressional hearing today, FED Chief Ben Bernake expressed his disappointment in the actions of AIG. While he denounced AIG's lack of risk-management measures, however, Bernake held to the notion that unfortunately AIG must be saved by the government. He stated that allowing the largest insurance company in the world to go under would create huge shock waves that would have caused instability throughout the entire insurance industry.
With the stock market plummeting again today, it is disheartening to know that this is a lose-lose situation. By saving AIG and other big banks/companies, the government is drawing a lot of doubt from the public. If the banks had been allowed to fail, however, the country probably would have seen a large-scale panic reminiscent of the days of Hoover.