George Soros on CDS Need Regulation

George Soros Says Credit Default Swaps Need Much Stricter Regulation - WSJ.com
By GEORGE SOROS
In all the uproar over AIG, the most important lesson has been ignored. AIG failed because it sold large amounts of credit default swaps (CDS) without properly offsetting or covering their positions. What we must take away from this is that CDS are toxic instruments whose use ought to be strictly regulated: Only those who own the underlying bonds ought to be allowed to buy them. ...