Sunday, March 8, 2009

On C-SPAN, Goatees and Getting Old

Google "you know you're getting old when..." and you'll come up with various lists of limitations and observations that supposedly signal the advancement of age. I have my own "You Know You're Getting Old..." list that includes watching the History Channel, liking radishes, and not knowing about half the 86 songs on Guitar Hero World Tour.

I recently added two more things to my YKYGO list. Watching C-SPAN for longer than my clicker takes to respond to the channel up button, and being called distinguished for the peppering of grey in my goatee. The former is my choice. The latter is not.

In any event, yesterday I stopped and watched what turned out to be the very interesting Senate Banking Committee's hearing from March 5th on what went wrong with AIG and why federal and state regulators did not or were not able to prevent its financial ruin and economic ruination. New York's own Insurance Department Superintendent Eric Dinallo was one of three persons who appeared before that committee, and his testimony at that hearing can be found here. Those interested in understanding what went wrong with AIG and how financial services regulation may be improved in the future should read Superintendent Dinallo's testimony.

In an article about the hearing of the same day, the New York Times explained:
After Congress knocked down the walls that once separated banking, insurance and capital-markets activity in 1999, these diverse businesses began knitting themselves together within A.I.G., creating unpredictable combinations. Regulators, still working in their narrow domains, did not keep up with the changes.
The fact that AIG Financial Products -- what the New York Times referred to as "the purveyor of the now-notorious credit-default swaps" -- was not an insurance company and fell outside the purview of state insurance regulations is largely blamed for the AIG group's demise. An argument against deregulation and in favor of greater regulation of financial service organizations if there ever was one. But because AIG's 71 U.S. insurance companies suffered the capital debilitating impact of AIG Financial Products' implosion, prompting the federal government's financial "rescue" of AIG last September, the insurance industry can expect new and tighter regulations in the future just as certainly as I can expect to discover new things to add to my YKYGO list.

1 comment:

Anonymous said...

Thanks Roy