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.

And THIS:

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

AND THIS:

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"

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