Private credit companies are key owners of AI-related assets. Many of their parent private equity firms own life insurers that are dumping grounds for bad loans—and subject to state bailouts.
prospect.org
Instead of passing through bankruptcy, insolvent life insurers have all their liabilities—in particular the policyholder claims—paid for by state guaranty funds.
    • Canaconda@lemmy.caEnglish
      8·
      16 days ago

      what money

      Problem is money isn’t real. The assets they are building are though.

    • Elvith Ma'for@feddit.orgEnglish
      3·
      16 days ago

      tl;dr:

      Life insurance companies invest your money in the stock market - they only need to pay it back after your death which is hopefully in a while and not like tomorrow. They’re involved in more risky investments and might bust regarding the AI bubble.

      There’s a mechanism that protects peoples savings with which they basically “insure” your savings for a little fee in case they go bankrupt. The problem is, that this fee will often be reimbursed by the state (and as such by the tax payer). So in the end, they get the gains from those investments and if they fail too much, all the risk is averted and paid for by the public.