Bank Bailout | featured news

The ailing economy. Health care. Bank bailouts. Troop deployments. Is President Obama juggling too many balls?

The chief executive officer of failed insurance conglomerate AIG acknowledged Wednesday that the company's multimillion-dollar bonuses were "distasteful" to many and had provoked a firestorm of wrath.

White House Press Secretary Robert Gibbs is not a lawyer, nor does he play one on TV. So when just about every question at Tuesday's afternoon briefing concerned bonuses at insurance giant AIG, Gibbs had a non-answer at the ready. "I'm not a contracts lawyer," he said at one point, later explaining that he was "not a contract lawyer," either. When asked whether the president could simply deny more money to AIG unless it scrapped bonuses, he repeated: "Again, I'd refer you to a contract lawyer, which I'm not one."

President Barack Obama declared Monday that insurance giant American International Group is in financial straits because of "recklessness and greed" and said he intends to stop it from paying out millions in executive bonuses.

Insurance giant reveals it paid more than $75B in taxpayer dollars in the final months of 2008 to numerous banks, as well as U.S. municipalities.

The Obama administration sought to reduce the bonuses, but the insurer, which received more than $170 billion in aid, said it was obligated to pay them.

Maxine Waters helped set up a meeting in which the chief executive of a bank with financial ties to her family asked for special bailout funds, officials said.

Freddie Mac, facing mounting damage from the U.S. housing crisis, said Wednesday it will ask the government for nearly $31 billion in additional aid after posting a gargantuan loss of more than $50 billion last year.

Bernanke accuses company of exploiting gaps in the system, says government 'had no choice' on bailout.

U.S. stock markets plunged by 4 percent to close at the lowest levels in nearly 12 years, igniting fresh concern over the depth of the financial crisis and where the bear market would find a bottom.