He used his deep knowledge of complex financial instruments he was part of a group at the bank that pioneered credit derivatives to steer the investment bank away from the mortgage-backed dross that destroyed others' balance-sheets.
What is important is what happens to money and credit flows as the Fed allows special lending programs to expire and begins to replace other purchased assets on its balance sheet, mainly mortgage-backed securities, with traditional Treasury bills.
Its unimaginably large losses, rooted in insurance it extended to financial companies engaged in subprime mortgage-backed transactions, have destroyed both AIG's corporate reputation and balance sheet.
But with the commercial mortgage-backed securities markets virtually shut down, the buyers could turn to their own balance sheets or to life companies and other institutional investors for support.
The Fed said in December that it was further expanding its balance sheet by purchasing Treasury securities in addition to existing buying of mortgage-backed securities.