On the news that AIG gave $90 billion to other banks, I say: well, yeah.
AIG is an insurance company. It guaranteed a lot of bonds and other assets owned by many banks. A lot of banks depend on that insurance to keep them from going bankrupt. If AIG had gone bankrupt, many of those banks would as well. That’s why the government keeps pumping money into it. So news that they’ve given $90 bil. to other banks is nothing more than recognition that the threat to rest of the banking system, American and European, is real and that government support of AIG is probably the right thing to do.