Here's The Untold Story Of How AIG Destroyed Itself

The details of AIG’s investment strategy have been largely obscured by the analogy with insurance. In the typical telling, AIG is depicted as insuring mortgage bonds packaged by banks. AIG often seems to be almost a passive and unsophisticated player that came in after the deal.

In reality, AIG was deeply involved in the creation of the financial products it insured, according to a person familiar with the matter.