The true story of how risk destroys, as told through the ongoing saga of AIG. From the collapse of Bear Stearns and … AIG-has until now remained largely untold. Fatal Risk: A Cautionary Tale of AIG's Corporate Suicide tells the inside story … of what really went on inside AIG that caused it to choke on risk and nearly bringing down the entire economic system …

equity capital to the risk-free interest rate. When equity capital falls, bankruptcy risks rise. Firms become more vulnerable … long time. -- liquidity trap ; financial crisis ; rare disasters ; equity capital ; leverage ; bankruptcy risk …

two of New York City's fifteen banks. Life and Fire Insurance became the largest of the bankruptcies. In violation of New … insurance industry. These lending practices, based on an instrument known as a post note, were initially sound, but were later …

that threatened those ratings. These insurers had four primary sources of risk: the proportion of structured finance in the … insurance portfolio, the proportion of structured finance in their investment portfolio, selling credit default swaps, and … credit ratings fell. We examine these risk exposures and the failings of the regulatory framework of these insurers …

American International Group, Inc. (AIG), a large insurance company, received a massive bailout during the financial … the company and some of its insurance subsidiaries. The paper argues that regulatory responses to AIG have been inapt. AIG … did not need another regulator, but better risk management. The markets would have conveyed that message clearly had …