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POPSHow can AIG lose 10B ? As you might know there are regulations that prevent insurance companies from gambling most of your Insurance premium on risky assets in order to make sure they'll be able to pay when disaster will strike. thats where subprime CDO's (and other wierd investment "vehicles") come into play (by making a risky asset look much less risky AIG can make more money on your insurance dollar). I loved this comment so much i clipped it and a background story in my prev clip, hope you enjoyed :)