WASHINGTON — The global financial crisis deepened on yet another frantic Friday as the Treasury Department weighed expanding its rescue efforts to include insurance firms and investors everywhere sought refuge amid strong signs of a coming global recession.
Stock markets around the world took another pounding, with Asian exchanges losing double-digit percentages again. U.S. stocks zigged, then zagged on another volatile day of trading, but didn't crash as some feared.
While the Dow closed down more than 300 points, shares of giant insurers rose Friday on word that the Treasury may expand its planned cash injections for banks to include life insurers, on the grounds that like big banks, they're too important to fail.
Treasury didn't disclose how or where it might inject capital into insurers, and the details are important because Treasury Secretary Henry Paulson repeatedly has noted that insurance needs to be federally regulated. State insurance commissioners now regulate the industry.
The Treasury isn't likely to assist property and casualty insurers that underwrite policies on homes and automobiles. Instead, it would focus on life insurers that offer annuities and other bank-like financial products.
An industry official, who spoke with McClatchy on the condition that his name not be used given the unfolding nature of the development, said that insurers such as Hartford Financial and Prudential Financial are the most likely to receive cash injections to shore up confidence in their solvency.
http://www.mcclatchydc.com/227/story/54732.html
Printer-friendly format
Email this thread to a friend
Bookmark this thread
(1000+ posts)
Send PM |
Profile |
Ignore
