The recent sight of the mighty JPMorgan Chase, wallowing in a credit default swap position from which it cannot exit, raises many questions. One of the key questions is a simple one: is the arena for credit default swap trading a marketplace or a mud pit?
Sadly, the answer is the latter. Without reforms, the CDS mud pit is likely to suffer the same fate as collateralized debt obligation: total irrelevance.
via Credit Default Swaps: Market or Mud Pit? – Bank Think Article – American Banker.
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