In Defense of Credit Default Swaps

They've taken almost as much undeserved abuse as John McCain's health plan. From L. Gordon Crovitz in the Wall Street Journal [here], take this:

We now know that we should not have feared huge losses in the multitrillion-dollar, unregulated market for esoteric instruments called credit default swaps. Transactions in this market have been orderly, and the losses have been modest.


Credit default swaps reduce risk for those who buy protection. They stabilize markets.


In the case of credit default swaps, there's no reason to fix what's not broken.


"Weird Al" Yankovic

"You Don't Love Me Anymore"

Comments (1)

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  1. Ken says:

    Thanks for this post and the link. There is a lot of nonsense being published, all because people are panicked.