In the fall of 2007, when the U.S. economy first seemed in peril, I began answering reader queries here on the Business Desk. I still do so occasionally, but this page has expanded to include posts from eminent economists, "far-flung correspondents," and a variety of voices that have intriguing and/or useful things to say about economics, broadly defined. Please feel encouraged to respond to any and all of them.
Did anyone ever propose regulation or restrictions on credit default swaps?
City & State:
Question/Comment: Excellent report on credit default swaps. Did anyone, Congress or the Administration, or the Clinton Administration, ever propose any regulation or restrictions on these financial instruments?
Paul Solman: Ah, regulation. The "genius" of these contracts was that they functioned as insurance, but were created in such a way as to avoid the considerable state-by-state regulations of the insurance industry.