Tab 6 AIG Transcript From 2010 0701 AIG Goldman Supporting Docs

8/7/2019 Tab 6 AIG Transcript From 2010 0701 AIG Goldman Supporting Docs

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Narne: Forster

Date: 7/11/07

Time:

Desk: 38

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J23G.txt

1 12362 MAN: Hi.3 ANDRlW: HOy.4 MAN: How ilre you doing?5 ANDREW: I 'm a l r i g h ~ . You?6 M/\!'-J: [OVERU\PPING] Yeah, so , so how was7 the bi g birthday party?8 ANDREW: uh , yeah, 'i t was good actua11 y,9 yeah.

10 MAN: How old?11 ANDREW: He was fau r y es e relay.12 MAN: Oh. Yeall.13 ANDRE\-J: [OVF:RLAPPING] I t , was ac tua l l y14 four on Sunday. His birthday party yesterday.15 ~ . 1 A N : That ' s a biq one.16 ANDREI': oh yeah. [LAUGHS] Exactly.17 MAN: Urn, I ' ve gut tv tell d funny sLor'y18 and I got a couple a couple of things for you.19 Urn, I was away th i s weekend wi th my budd>i es on my20 annual golf t.t'ip. This year we went to, uh,21 [PINEHURST 7J, in. uh. Scotland.22 ANDRE-\;J: Right .23 MAN: And we're d rj vi ng back to the24 airporT an d we always play, we'r 'e, you knov ., .. we25 know Pilch o t h ~ r ver'y, very, very well . Put it

1 that way. And. uh, we ah;ays play these funny2 games. My fr i end [,lI.,LAN ?J [U\ST f \ V ~ . M E ?J was w'i1:h3 me and another buddy. And he came up with this

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1236. tx t4 game where he had t:o say words that we had to5 guess how you would 5flY thf>m, you know, i f you6 were in England.7 /\NDREt'J: Ri ght . [LAUGHS]8 M A ~ : You know, [LAUGHS] cause my fri end9 A1an happens to be ve ry.. He I s got a good ear for ,

10 for . for l inguist ics and he l ike, he ca.n pick up11 a l l kinds of .. l ike how you'd say garage ins tead12 of garage; things likp.13 ANDREW: Right.14 M)\N: That ' s l ike a kind of hokey one.15 Anyway, every time he'd sa y a word one of my16 f i 1 S t ways of t ry i ng to f i gu roe out hov-v it mi ght17 be pronounced, pronounced is I tr ied to imagine18 i f you we re sayi ng ; t to me. For' some reason you19 WAre my go-"to men'tal, uh , image for the audible20 [UNINTELJ21 ,L'..NDREtJ: [OVERL,A,PPlt-1G] [ U ~ . U G H S J I see, I22 was th i- , you were thinkinq about me.23 r1AN: exact'l y. And, uh, maybe,," I can' t24 remember some of the words he picked. urn, uh, urn,25 on instead o-F sayln9 specia l ty I guess in the UK,

1 you say speci a l i t:y. Is tha t ri ght? I s tha t . "i 52 tha t ._ tha t i s one?3 ANDR[W: Special i ty , yes , specia ' l i ty ,4 yeah.

r 1 ~ N : Righ-t. Su i t , it was a game l ike6 that. We were driving the ca r from pinehurst to7 the airport , about an hour's ur ive. And t h d t8 would be a typical game tha t we would come up9 wi th . So, anyway, i t s been on my m-i nd .

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"1236.txt10 Speaking of which, how, uh , how i s

11 everything?12 ANDREW: I t ' s , uh, you know, alr ight .'1" 11 A",I Ie 1.LJ L J _ . r " - ' ~ ~ I I .. J

14 ~ l A N ; I mean what ' 5 go i ng on 1 ke SOl't15 of .. what hdve you been lh i nk-j ng about or focused16 on or . and how [UNINTEL]17 ANDREl'J: [OVERLAPPINGj what ar'e we18 f o c L l s ~ n g on? .!.'m focusing on CD.A.S and suhprimeo19 MAN: Yeah obviollsly.

ANDREW: Nuthing else. And spending ~ o s t 21 of my t ime answel'ing questions of [ENTERGY ?]22 guys, AIG, you kllOw, sullivan, [MCDEAN 7], Lewls,

24 '-'iAN: Right.25 A ~ m R E W : Every fucking one you know.

1 Every rating agency we've spoken to. You know,2 every time they come out with m o n ~ . d o w n g t ~ a d e s vJe3 have to go and get that and then analyze ,,11 th e4 exposures we've got in the rest of .; +- C-,.,. , ."'' ''L . . ~ U , yvu5 know, fair ' ly t ime consum-ing. So ..6 MAN: Urn, and how .. f\part from th e f ac t7 t h ~ ~ it's to tal ly dis t rac t ing an d tota-Ily not8 di rectional-Iy the t ~ i g h t way we want to go , tlOW ..9 so are you [THOROUGHLY ?J concerned or you just

10 sort o ~ _ more [UNINIEL]11 Aim Rcw' : [OVERLAPPING] Ah, you know, i f

ynu'd asked me, urn, uh. probably about a month13 ago I was 1 ike, you know, ; ,uicidal sid. 1 mean 114 guess it's, uh thE' actual s tuff that ' ~ . , cotn'i ng up15 rUNINTEL] actua11 y i s , is 51i gtll l y be U e r than ..

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, .1236.txt16 you know, it kind of [CEMEt\:T O?], you know, the,

17 the hope was always tha t i 1: IS go; ng to be 200618 s tuff and 2005 collateral will be, uh, you know,19 ~ ' v ' i l 1 perform much bet te r .20 MAN: yeah.21 ANDREW: And the r'atin9 agency s tuff I22 guess is slightlY, you know. confirming that.23 MAN: YUP. yup.24 ,A.NDREW: I gues s so it he 1ps from t ha t25 point of view in ter'ms of sor t of ultimate loss .

1 The problem that we're going to face is that2 we're going to have just enormous downgrades on3 the s tu f f tha t 'Ne' VB got_4 MAN: Right,5 ANDREW: So, you know, yuu know, we so r-t6 of s i t there with a 60 bil l ion coo book and. you7 know, now we're sor t s ' l t t ing and saying, yeah,8 yeah, it's [SUPER SENIOR ? j , i t l s super senior ,9 you know. I t i sn ' t going to be ,too much longer

10 before we're saying, yeah, okay, alrigh-t , we've11 got, you know, 20 bi'llion of single A risk now.12 And tha t ! s going to happen. T h e n : ~ ! s no doubt13 about i t .14 MAN: lOVERLAPPING] [UNINTEL] You think15 i t s down that far ' , s i ngl e. ,A,?16 ANDREW: Yeah, oh yeah, But this is just17 going to go from t r ip le ... I mean i t ' s18 immediately just going to go t r iple A, double A,19 single A. And i t=s just .-20 MAN; Yeah,21 ANDREW: YOU know, you've got t r iple Bs

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1236.txt22 downgraded to t r ip le cs , you know, a lo t of t.he23 t r ip le BS are going to go down to single B. I t ' s24 going to get very , urn, very, very ugly fo r the25 next [UNINTEL].

1 MAN: They' r"e, um .. Is thel"c concern tha t2 there s .. that, t h a ~ thaT evenT could cause us3 [HAVE TO MARK ?J?4 ANDREW: You know, a I I o f th i 5 s tu f f5 doesn ' t he'lp because, you know, a l l , a l l the6 accounts are si t t ing thet'e and they read the7 papers that say, you know, murks down hen:.' and8 people ar e trying to hide marks and th e rest of9 it . So they, you know, there ' s l o t ~ of q u e ~ t 1 u n s

10 from them as to why rUNINTEL], you know.11 Everyone t e l l s me tha t i ' t is t rading and12 it's tl,\ 'O lower and all the r 'pst of i t i'!nd13 how come you carl ' t mark your book. So i t ' s14 definite']y going to give i t r Q n p ~ 2 d focus.15 MAN: Right .16 ANDREW: I mean we can' L . \\'f::' hdve to17 mark i t . I t ' s ~ i t ' s , uh; we're [UNINTEL] fucked18 baSical ly.1.9 MI'\!'i: yeah. no, clearly it's pret ty big,20 uh, one to have to mark.21 A N D R E \ t ~ ' : Yeah.2? MAN: But, uh, I mean the que , I mean . ,23 1 get a fairly, a fairly good argument to be made24 is i f it was h ~ r d to mark whpn it was SUP-, super25 sen4or, i t doesn't mean i t ' s any easier to mark

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1236,txt1 jus t because there 's .. i t ' s not super SenlQr2 anymore.3 ANDREW: Yeah, you know, we thought we'd4 t ry to .. "fiE obviously ~ ' l i e ' r e t rying to .. I mean I , I5 think i t ' s [UNINTEL]6 iViAN: [OVERLAPPING] In some ways7 especially I , 1 would argue i t ' s harder to mark8 now. Cause now you have different opinions on9 what 's [UNlt-JTEL] qual i ty . \.A/hef1 i t . 's super senior ,

10 when [UNINTEl] agrees i t ' s super senior the -11 ANDRD'J: The problem -is there': ; more o f12 market now, That people are actually, you know",13 Befor-e -14 ,olAN: yeah,15 ANDREW: You know, i f you th i nk about i t16 befo re... [BACKGROUND VOICE] oh hold on . Yeah_17 [BACKGROUND VOICE]18 [am 01= TAPE]192021222324

1 A plus Recording and Transcribing, a division of2 A plus oifice S U p j J O i ~ t systems, states that th e3 preceding t ranscript was created by one of i ts4 employees using standard electronic transcription5 equipment and is a true and accurate record of6 th e audi a on th e provi ded med'i a to the best of

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1236.txt7 that employee's abi l i ty . The media from itvhich we8 worked was provided to l iS. We can make no9 s t a t e m e n ~ as TO i t s authenticity.

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Tab 6 AIG Transcript From 2010 0701 AIG Goldman Supporting Docs