Commentary: CDS data are used to manipulate markets rather than insure debt

10/17/2011 | Forbes

Rather than protect investors against losses, credit default swaps often are used to influence bond ratings and set market direction, writes Steve Forbes, chairman and editor-in-chief of Forbes Media. "One of our columnists, noted economist David Malpass, has long warned of economic harm from the CDS market," he writes. "This is where regulatory-mandated transparency in the actual volume behind CDS prices would do a world of good."

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