A side of the subprime mess I wasn't completely aware of

Sep 23, 2008 13:08

AIG failed not because it bought mortgages or mortgage-backed securities, but rather because it wrote policies, called "credit default swaps", to insure others against the risk of default in mortgage-backed securities. Literally, one of these policies says that the insurer would pay an amount (e.g. $1000) to a creditor if a particular counterparty ( Read more... )

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175560 September 23 2008, 21:36:22 UTC
AIG is a public corporation.

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