Bernanke Takes the Stand, Defends Terms of AIG Bailout

The transcript covers Ben Bernanke's testimony regarding the AIG bailout, highlighting his reluctance to testify and the legal challenges posed by Hank Greenberg's team. Bernanke defended the harsher terms for AIG compared to banks, citing moral hazard and unique circumstances. The legal team questioned the legality of the Fed's equity stake in AIG and whether AIG was treated unfairly. The government argued that their intervention prevented worse outcomes for shareholders.

What was Ben Bernanke's demeanor during his testimony about the AIG bailout?

• He appeared annoyed and kept his answers short.

• He was enthusiastic and talkative.

• He was excited and detailed.

• He was confused and unsure.

What was the main reason given for the necessity of the AIG bailout in 2008?

• To increase government control over AIG.

• To support AIG's expansion plans.

• To provide bonuses to AIG executives.

• To prevent a global financial crisis.

How did David Boies demonstrate the difference in treatment between AIG and banks during the bailout?

• By indicating AIG was exempt from regulations.

• By proving AIG was given more time to repay.

• By highlighting AIG's harsher terms compared to banks.

• By showing AIG received more generous terms.

What is one of the central legal questions raised by Greenberg's team?

• Whether AIG could change its board of directors.

• Whether AIG could issue new shares without approval.

• Whether AIG was allowed to merge with another company.

• Whether the Fed could legally take an equity position in AIG.

What is the government's argument regarding the impact of their intervention on AIG shareholders?

• Shareholders were in a worse position after the intervention.

• Shareholders were harmed by the intervention.

• Shareholders were better off due to the intervention.

• Shareholders were unaffected by the intervention.