Wall Street Manna

An irreverent look at Wall Street

Tuesday, September 16, 2008

PIMCO gets bailed out-again!

Twice in two weeks!

First it was the GSE debt. Now it's AIG! The US Government is pimping PIMCO!

Remember McCulley yesterday pounding the table and sreaming that the Fed had better do something dramatic?

Well it was because PIMCO guaranteed $760 million of AIG's debt!

``The Fed doesn't have to necessarily put its own capital at risk,'' Gross said. ``We'll see what the plan says, but I think it's definitely a necessary step.''

Gross, the manager of the world's largest bond fund, may lose money if AIG defaults on its debts. His Pimco Total Return Fund guaranteed $760 million of debt issued by AIG as of June 30, according to a regulatory filing.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aModqMIEqaGY&refer=home

PIMCO? How about "Pimp"Co!

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