Just watched professor Roubini of NYU on TV. He discussed credit default swaps. Roubini says that credit default swaps (CDS) are the big bear on the horizon: They aretotally unregulated.
Peter Cohan at BloggingStocks takes a jab at John McCain's chief economic adviser Phil Gramm for the bill amendment that sparked the huge growth in the CDS market, which is 48 times bigger than the $1.3 trillion worth of subprime mortgages and a key reason for Lehman's demise. "Since nobody has ever had to deal with this volume of CDS unwindings, it is impossible to calculate how much they will cost," Cohan wrote.
Gee, thanks. This is going to be a great help for my insomnia.[&o]
Phil Gramm has been well up toward the top of my Least Favorite People list for years now. He keeps managing to climb closer to the top with each new detail about that deregulation package he slipped through.
Credit Default Swaps
