CDS

CDSCDS

=

CDOBB10%100 bp$10 million

CDS

CDOBB

10%100 bp$10 millionAIGAAACDS1%CDS$10 million )

CDSCredit Enhancement

CDOAAA

10% 1% = 9%900 bp$10 millionAIGAAACDS1%

CDS$10 million )AAA

CDS

CDOBB

AIGAAA

CDS1%

CDS$10 million )

CDS

10%100 bp$10 millionAIGBCDS$10 million

CDS$10 million

CDO

CDS

10%100 bp$10 millionAIGFed the Treasury DepartmentBailoutsCDS$10 million

CDS$10 million

CDO

AIGCDS

200846172008992.9

AIG

FedAIG $600400AIG

AIG

AIG haircuts

199820081003347notional value683

CDSCDSreference entityCDSreference entity

CDS ?CDS

CDS ?indemnity

CDSCDSCDSCDSCDSCDS4

CDS

CDS

CDS

CDS

CDSCDSCDSAIGCDSWarren Buffet2003financial weapons of mass destruction

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