Just when you thing AIG’s situation couldn’t get any worse, it does. With today’s discovery that AIG gave $165 million in bonus money to executives, which was funded by bailout money, have caused massive uproars from the president, Ben Bernanke, and taxpayers. After the government injected billions of dollars into AIG, AIG feels that some of the executives that got them into their situation deserve and need bonus compensation. It makes you wish that all jobs were like this, where you get compensated for negative results.
Resulting from this greed will put AIG into a worse position than it already is. The public that is disgusted by AIG’s actions may not want to do business with the company in the future. This decision ultimately has affected AIG’s image and will have a negative impact on future cash flows. This could further prolong the financial instability, since the government bailed out AIG to save the financial institution.
Links:
http://www.foxnews.com/politics/2009/03/16/lawmakers-target-aig-executive-bonuses/
http://online.wsj.com/article/SB122156561931242905.html
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