Credit Derivatives : Systemic Risks and Policy Options?

Credit derivative markets are largely unregulated, but calls are increasingly being made for changes to this "hands off" stance, amidst concerns that they helped to fuel the current financial crisis, or that they could be a cause of the next one. The purpose of this paper is to address two...

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Main Author: Kiff, John
Other Authors: Elliott, Jennifer A., Kazarian, Elias G.
Format: eBook
Language:English
Published: Washington, D.C. International Monetary Fund 2009, 2009
Series:IMF Working Papers; Working Paper
Subjects:
Otc
Online Access:
Collection: International Monetary Fund - Collection details see MPG.ReNa
Summary:Credit derivative markets are largely unregulated, but calls are increasingly being made for changes to this "hands off" stance, amidst concerns that they helped to fuel the current financial crisis, or that they could be a cause of the next one. The purpose of this paper is to address two basic questions: (i) do credit derivative markets increase systemic risk; and (ii) should they be regulated more closely, and if so, how and to what extent? The paper begins with a basic description of credit derivative markets and recent events, followed by an assessment of their recent association with systemic risk. It then reviews and evaluates some of the authorities' proposed initiatives, and discusses some alternative directions that could be taken
Physical Description:35 p.
ISBN:1451874006
9781451874006