Charlie Bottle

Lehman's Loss: More Than $200 Billion

CDS are markerd to market daily, however it really up to each buyer of CDS to request for additional collateral. I'm not aware of any guidelines by ISDA (although there may be and still be looselly applied by participants). So in a situtation like lehman where the credit spreads ramin tide until a few days before BK, the chances are that collateral posted is quite short.