AIG’s Financial Products Group: a bold experiment to master the variable that has defeated so many visionaries: Risk.
“It was Howard Sosin who said, ‘You know, we’re not going to do trades that we can’t correctly model, value, provide hedges for and account for.’ ”
Though the language of caution was the same, the firm’s drive toward novel and ever more lucrative deals led down the path of greater risk. The beautiful machine was about to crack.
http://www.washingtonpost.com/wp-dyn/content/article/2008/12/28/AR2008122801916.html