AIG Q4 2007

--loss 5.3 bil, driven by After Tax writeoff of $7.23 bil in unrelized super senior CDS in Financial service operation capital market business (AIGFP) --exposure: 116 bil by the end of 2007 --1 tril asset, 95.8 bil equity evaluations --AA, 10 y 210 bps --AA, 10y 6.9 12/2017, 280 bps --5y, 10y 170 bps, 5y 180. comments/strategy --market will continue to deteriorate until Q2. buy 10y (6.9%) + long 5y CDS --or long 10y bond directly. large company diversified business, 6 bil profit in 2007, enough cushion to avoid a default.