Hard Market First Quarter Report

Colleagues.

So much has happened this year! I am excited to bring you my first real installment of news information I hope you will find useful. Major Link update coming soon!

On my last post I mentioned that Berkshire Hathaway was going to be the Next AIG. Here is a quick snapshot on what I plan to investigate this year.

There are several credit rating agencies that allow insurance companies to borrow money and loan it out. Their guidelines and ratings are what allow the lenders to offer them cheap money. I am sure you all know that AIG did a lot more then insurance. In fact they used some premium dollars from insurance to go into other arenas to try to get a better return on investment. In essence they were trying to make money with their great credit and insurance products was one of their revenue sources. Well I am not going to go into detail why AIG got hit but I do have a forecast about AIG, then I will move over to Berkshire Hathaway.

I believe AIG will be the first Nationalized insurance company. In fact I bet they are the first people to help out on this National Health Care Program. I have some other beliefs on this but I don't want to go to deep into it right now because I am not in a philosophical mood.

Onto Berkshire....The Insurance Industry is controlled by old Architects who don't like American Insurance companies messing with their turf. Berkshire is starting to make waves in the international community and are making the old school insurance architechts upset that they are moving onto their turf. There are several reasons for this. First they don't like loosing money. Second they don't like anything to change or be different then their current supply chain for insurance. For a great article on this vist my friend's Article called the Inefficency Paradox excellent reading! So why am I saying that Berkshire willbe the next AIG? Well it started once AIG lost it's AAA credit rating. Investors got scared and felt the old man Hank was just unable to run the company anymore. This was in fact something that was done by old world brokers...stir up the beehive to kill the boss, then the old world brokers would come pillage the honey.

The same thing just happened this month. Fitch dropped Berkshire's credit rating. If you look at some of the links in past blogs you will see one of the main reasons was due to the Ironclad control by Warren Buffet. I may be wrong and Warren may be able to hold onto Liberty Mutual and his other Insurance Companies but I sure there is someone or some powers trying to wrestle it from under his control. If this happens say goodbye to the last real American Insurance company! I will be talking about this as more information is released or I find out some more dirt.