New York Fed: Toxic assets from AIG gaining value
WASHINGTON -- The Federal Reserve Bank of New York says toxic assets that the government took over from American International Group Inc. and Bear Stearns at the height of the financial crisis are gaining value for the first time.
The New York Fed says the investments are worth about $2 billion more than they were during the previous quarter. They lost value quickly, triggering the government bailouts of those companies.
The New York Fed engineered a rescue of AIG that was worth up to $182 billion. It took on bad assets from Bear Stearns to help JPMorgan Chase & Co. buy the failed investment bank.
The investments' recovery shows that private demand for the securities has increased despite the shaky economic recovery. But the government is still expected to lose money on the AIG bailout.
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