$22B Bailout for Life Insurers: Mystery of Thursday's Rally Revealed! But Why Now?Posted May 15, 2009 11:47am EDT by Aaron Task<http://finance.yahoo.com/tech-ticker/author/Aaron-Task>in Investing <http://finance.yahoo.com/tech-ticker/Investing>, Banking<http://finance.yahoo.com/tech-ticker/Banking> Related: PFG <http://finance.yahoo.com/q?s=PFG>, ALL<http://finance.yahoo.com/q?s=ALL>, HIG <http://finance.yahoo.com/q?s=HIG>, LNC<http://finance.yahoo.com/q?s=LNC>, AIG <http://finance.yahoo.com/q?s=AIG>, AMP<http://finance.yahoo.com/q?s=AMP>, PRU <http://finance.yahoo.com/q?s=PRU>
*Updated from 11:47 a.m. EDT* News the government is going to shower the life insurance industry with $22 billion of TARP funds<http://online.wsj.com/article/SB124234565889921705.html>solves one mystery: Why related stocks were curiously strong Thursday, prior to public disclosure. *Update:* "The evidence is compelling that the big institutional money was betting on this TARP approval for the insurers," writes Jon Najarian, co-founder of OptionMonster.com <http://www.optionmonster.com/>. "The other darker option would be that the big money was tipped off that the TARP news was pending. For my money I say there is no such thing as a coincidence on Wall Street!" Najarian notes there were some unusually large bullish bets on several insurers Thursday via the options market: - Lincoln Financial (LNC) - 21,000 calls yesterday vs. 30-day average of 5,500 - Prudential Financial (PRU) - 8,500 calls vs. 30-day average of 6,500 - Hartford Financial (HIG) - 114,000 calls vs. 30-day average of 21,100 - Principal Financial (PFG)- 8,700 calls vs. 30-day average of 1,600 "As smart money usually does, the buyers of these calls sold quickly" on Friday, he reports. "Or as I like to say, they took the money and ran!" *Earlier:* Beyond the outrage of possible (even likely) insider trading <http://www.businessinsider.com/will-anyone-investigate-insider-trading-in-the-insurance-stocks-2009-5>ahead of the TARP announcement, this news raises other riddles Barack Obama, Tim Geithner and Ben Bernanke need to address: - Why does the line insurance industry need $22 billion of taxpayer funds? - Why *now*, in the wake of the post-stress test bank capital raises, market rally and growing sense the financial crisis is over? - How will the industry respond to the possible overzealous government oversight that comes with TARP funds? - What horse trading, if any, went on between the life insurers and the administration? Obama wants to remove about $12.8 billion of tax breaks from the life insurers <http://www.latimes.com/business/la-fi-taxes12-2009may12,0,6632793.story>to help pay for health insurance on the one hand, but is giving the industry a $22 billion boondoggle on the other. - http://finance.yahoo.com/tech-ticker/article/248803/22B-Bailout-for-Life-Insurers-Mystery-of-Thursday's-Rally-Revealed!-But-Why-Now?tickers=PFG,ALL,HIG,LNC,AIG,AMP,PRU?sec=topStories&pos=5&asset=&ccode = --~--~---------~--~----~------------~-------~--~----~ You received this message because you are subscribed to the Google Groups ""GLOBAL SPECULATORS"" group. To post to this group, send email to [email protected] To unsubscribe from this group, send email to [email protected] For more options, visit this group at http://groups.google.com/group/globalspeculators?hl=en -~----------~----~----~----~------~----~------~--~---
