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Non-Tech : Derivatives: Darth Vader's Revenge

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From: Worswick9/19/2008 8:36:38 AM
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Wall Street Jorunal 9.19.08

Parts of the market for credit-default swaps froze up Thursday, as large dealers sought to limit their exposures to each other amid worries about the ability of financial institutions to meet their obligations.

Some hedge funds and money managers that tried to unwind or step out of outstanding credit-default-swap trades with large brokerages were unable to find new counterparties to take over their positions. Others said it was difficult to buy default insurance on financial institutions such as Morgan Stanley and Goldman Sachs Group Inc. because not many dealers were willing to take on risk ...
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