Laid an AIG?

Has the US government laid an egg or been laid by an AIG?

AIG Seeks to Ease Its Bailout Terms

American International Group Inc. is seeking an overhaul of its $150 billion government bailout package that would substantially reduce the insurer's financial burden, while further exposing U.S. taxpayers to its fortunes, people familiar with the matter say.

Government approval would signal a complete turnabout in its approach to the insurer since it first intervened to rescue it: from that of a creditor to one of a potential owner.

At the time of the original bailout in September, the government imposed what many considered onerous interest rates and deadlines for AIG to repay its loans by selling off assets. It quickly became clear, however, that the erosion of the value of AIG's assets and worsening financial crisis would make it difficult to meet the goals without jettisoning assets at fire-sale prices.

Under the new structure, AIG's interest burden on the government money would be reduced. AIG would continue to try to sell some assets to repay its obligations but other assets would be transferred to the government in lieu of cash repayment. One major sticking point is how to value the assets, especially because prices are in rapid decline.

The government's stake in the parent company already stands at nearly 80% and is unlikely to be substantially changed in the near term, according to a person close to AIG.

The new plan is being structured in close consultation with major credit-rating agencies.

That's right, the folks who got us here in the first place.

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