US Lawmakers Weigh Ban On Naked CDS Trades

Legislators in the US will consider a bill that would prohibit OTC credit default swap trading unless the parties involved owned the underlying bonds
By None

Legislators in the US will consider a bill that would prohibit OTC credit default swap trading unless the parties involved owned the underlying bonds, according to Bloomberg.

Such regulation could “kill” the market, according to one source. European Commissioner Charlie McCreevy told reporters at Davos that he would not support similar legislation in Europe.

For the full draft, head to the House Agriculture Committee’s Web site, and look for the Commodity Futures Trading Commission Reauthorization Act of 2007.

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