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To: James Hutton who wrote (248742)	5/18/2010 8:48:46 PM
From: Broken_Clock	Respond to of 306849

"US Senate Rejects Ban Of Naked Credit Default Swaps" another AIG moment... brought to you by your friends at the Fed. "I'm Marcus Goldman and I approve this message!"

To: James Hutton who wrote (248742)	5/19/2010 6:21:09 AM
From: dealmakr	Respond to of 306849

"U.S. senators late Tuesday rejected an amendment to a sweeping bank-reform bill that would have prohibited so-called naked credit default swaps. Credit default swaps are a form of insurance that institutions buy on bonds they purchase against the possibility that those bonds default. However, naked credit default swaps are derivative investments set up by two investor groups that have no insurable interest but are betting on whether another bond will default. The measure, which was introduced by Sen. Byron Dorgan (D., N.D.), would have been attached to a bank-reform bill under consideration in the Senate. A measure banning naked credit default swaps was approved by the House as part of a bank-reform bill it approved in December." This is one of the premier reasons of why the market system is broken with naked speculation rampant on underlying assets that the parties don't have any financial interest in, you have to wonder how much these guys are being paid off. Kudos to the Germans for having the balls to say enough is enough when it comes down to banning naked CDS transactions. They have no purpose other than to decrease stability and increase the ability of an outside party to game the system. Question to the rulers in Washington; When somebody yells that there is a fire, are you going to wait until your ass is burning before taking action? dealmakr