My da|ra Login

Detailed view

metadata language: English

Replication data for: AIG in Hindsight

Resource Type
  • McDonald, Robert
  • Paulson, Anna
Publication Date
  • Abstract

    The near-failure on September 16, 2008, of American International Group (AIG) was an iconic moment in the financial crisis. Two large bets on real estate made with funding vulnerable to bank-run-like dynamics pushed AIG to the brink of bankruptcy. AIG used securities lending to transform insurance company assets into residential mortgage-backed securities and collateralized debt obligations, ultimately losing at least $21 billion and threatening the solvency of the life insurance companies. AIG also sold insurance on multisector collateralized debt obligations, backed by real estate assets, ultimately losing more than $30 billion. These activities were apparently motivated by a belief that AIG's real estate bets would not suffer defaults and were "money-good." We find that these securities have in fact suffered write-downs and that the stark "money-good" claim can be rejected. Ultimately, both liquidity and solvency were issues for AIG.
  • Is supplement to
    DOI: 10.1257/jep.29.2.81 (Text)
  • McDonald, Robert, and Anna Paulson. “AIG in Hindsight.” Journal of Economic Perspectives 29, no. 2 (May 2015): 81–106.
    • ID: 10.1257/jep.29.2.81 (DOI)

Update Metadata: 2020-05-18 | Issue Number: 2 | Registration Date: 2019-10-13

McDonald, Robert; Paulson, Anna (2015): Replication data for: AIG in Hindsight. Version: V0. ICPSR - Interuniversity Consortium for Political and Social Research. Dataset.