Super panic about AIG

Look at the queue outside the AIA tower, we know that many of them are in panic mode regarding their insurance policy and the cash value of their insurance. Many took the redeem first, think later approach when fear and panic set in. It is kind of human instinct to do that, just like stock market.

Of course, people who hold on to the AIA policy would be afraid, including me. But, we have to analyse the situation. AIA as a company itself, under the MAS regulation, should have operate within the guideline. From their statement, they have adequate fund to cover all the policy holder.

On a separate note, AIG is such an american icon, the FED won't allow a sudden collapse. This is hard to articulate, but it is a logical step for them. So, I am not that worried with my AIA policy.

This is human behaviour which could explain the current market rout. Now, it is driven by news and not really by valuation. We are just at one extreme end of the market cycle. But buying in now, means you have to endure the volatility and your nature fear. Unless you have mind of steel, you better stay sideline for now. Give it another 3 months and see how is the situation. Market is not likely to just recover suddenly, expecting more "collapse" maybe. Sit tight...