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AIG sold a very significant number of CDS's (credit default swaps) on mortgage backed securities to financial institutions who wished to hedge the mortgage backed

AIG sold a very significant number of CDS's (credit default swaps) on mortgage backed securities to financial institutions who wished to hedge the mortgage backed securities in their portfolios. Explain why the US Government might have decided to "bail" out AIG. (Hint: consider what might have happened if they didn't)

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