Jakester

Lehman's CDS Mess: Who's on the Hook?

A suggestion... since taxpayers are the ones who are on the hook for AIG's incalcuable incompetence, these CDS policies should not be paid off to hedge funds unless they can prove that they were long Lehman and using the CDS as an actual hedge when they were purchased. The taxpayer should not be liable to hedge funds that shorted Lehman and purchased CDS policies. As Cramer suggests, it's like buying insurance and then torching the house. That's criminal behavior and this is not that different. If AIG were not now owned by taxpayers I'd say let AIG go under having to payoff these policies, but hedge funds should not be allowed to pick the taxpayer's pocket. Reply |Report abuse