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A sign of the times March 24, 2009

Posted by fetzthechemist in Uncategorized.

One of the stocks I have is that of an insurance company. It was never bought. The life insurance policy I have had for years and years was bought from a mutual company – a dinosaur in these days, but common then. The policyholders essentually owned the company through their paying premiums and getting dividends.

The company went public a few years back and diversified into the full financial world allowed by deregulation (that story is another one and not a happy one, AIG is the big example of things gone awry because insurers are not bankers and lack of constraints led to a totally stupid virtual money system.) When they went public, policyholders got stock.

That stock has plummeted to below a dollar a share. So now the board of directors want approval to have reverse stock splits – why couldn’t they call them something more straightforward like stock coalescing or combining?. Anyway, the boom had stocks soaring and splitting like crazy. This bust has the reverse.



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