AIG Adds $10 Billion Debt

More disturbing news on the financial black hole known as AIG: The Wall Street Journal reports that the insurance giant "owes Wall Street's biggest firms about $10 billion for speculative trades that have soured." AIG has maintained that its trades helped other financial institutions to insure their holdings, but this is evidence that it was also gambling with its own capital. It now needs to pay off those debts, but the terms of the $150 billion bailout the AIG has received do not cover them: The bailout purchased bad securities to ease AIG's struggles, but these trades were purely speculative, with no underlying securities to purchase. The Fed has no immediate plans to aid AIG in paying off these debts.