AIG is the epitome of "Too big to fail"

That's why it will be bailed out. I have no doubt in my mind. However, as their "punishment," AIG equity holders should be crushed like GSE stockholders (see Bill Miller). Looking at the overall catastroph*ck going on, I am reminded of these wise words:

“If they are too big to fail, make them smaller.”
-Former Treasury Secretary George Shultz

P.S. Given AIG's global embarrassment, they should never be allowed to advertise on sports teams again.