This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

The Five Dumbest Things on Wall Street This Week

2. C-GAITS. C-GAITS Run. Run, C-GAITS, Run.

We're feeling sorry for American International Group (AIG - Get Report) this week.

Well, sort of.

On Monday, the insurance giant disclosed that the Securities and Exchange Commission may take legal action against the company.

At issue are three press releases AIG issued related to some old transactions it had with PNC Financial Services (PNC - Get Report) -- not the actual transactions, mind you, but press releases referring to the transactions. One of those press releases came out in January 2002, and two were issued last month.

One of last month's press releases mentioned that an SEC investigation of AIG "involves certain transactions" marketed by AIG, "including three transactions" with PNC.

Now, as we read that press release, we interpret that phrase "including three transactions" as meaning that more than three deals were under investigation.

But the SEC's staff, AIG explained Monday, thinks that AIG was "false and misleading" by not mentioning five other transactions the feds believe were similar. Furthermore, the SEC staff believes AIG should have named the counterparties to these transactions.

In other words, as far as we can tell, the SEC didn't just want AIG to tell the truth in its press releases; it wanted AIG to explain the whole truth, in detail, revealing every dark corner of the company's interaction with the SEC.

What, are they crazy? What do they think a press release is for? It's for getting information out that's true, if not necessarily exhaustive in its ugliness -- sort of like the wedding announcements page in your local newspaper. We'd hate to see the SEC in charge of that.

On the other hand, we note that in its defense of the 2002 press release, AIG seems to argue that the three PNC transactions -- which AIG calls C-GAITS -- are, like, totally, completely different from the other five transactions, known as GAITS.

Hmmm.

In deciding that question, we think it would help to know what C-GAITS and GAITS stand for. But an AIG spokesman won't tell us, or anyone else.

2 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,672.60 -141.38 -0.79%
S&P 500 2,051.82 -11.33 -0.55%
NASDAQ 4,757.8790 +7.4820 0.16%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs