Lawmakers take aim at CDS market

Regulators have been threatening the credit derivatives market with draconian new legislation in a bid to curb practices that supposedly exacerbated the current turmoil. But the lawmakers' belligerent comments are somewhat akin to closing the windows when the hurricane has already started. The damage to the credit markets is done. And there are fears that excessive regulation could stifle future growth in the CDS market. Sarfraz Thind reports

Regulators have played a big hand in the current market crisis. Rescue packages, bail-outs, nationalisations, bans on short selling and some of the most famous dealers losing their investment banking status and coming under state authority - all this has happened in the space of a couple of months.

And now regulators are looking to impose their authority on the credit derivatives world in order to curb the rampant speculation that these instruments apparently provoke. In late September the New

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