The Notebook: AIG On The Brink

It's the latest crisis to rock financial markets: insurance giant AIG teetering on the brink of bankruptcy.

The problems stem from AIG's financial products division, not insurance. But investors are nervous because this is a colossal firm. If it fails, the ripples would travel far and wide through the global economy. Businesses from banks to manufacturers which had insurance could find themselves exposed. An airline, for example, that bought a contract guaranteeing a certain cost for fuel, could suddenly have to pay full price.

There's better news for individuals. Life, auto, and homeowner policies are guaranteed by state funds. So, claims would still be paid up to certain limits. People with retirement annuities also have protection.

AIG is hoping for a bailout from its competitors. If it doesn't get one, fasten your seat belt. The fallout could touch every corner of our economy.


Follow Us

Watch CBSN Live

Watch CBS News anytime, anywhere with the new 24/7 digital news network. Stream CBSN live or on demand for FREE on your TV, computer, tablet, or smartphone.

Watch Now

On Twitter

New Android App

For your Android phone and tablet, download the FREE redesigned app, featuring CBSN, live 24/7 news.

The all new
CBS News App for Android® for iPad® for iPhone®
Fully redesigned. Featuring CBSN, 24/7 live news. Get the App