Given how atrocious the reporting on credit default swaps has been during the financial crisis, it's refreshing to see this paragraph in a Bloomberg article by Shannon Harrington and John Rega about CDS clearinghouse developments:
Bets made through credit-defaults swaps helped push American International Group Inc., once the world’s biggest insurer, to the brink of bankruptcy before the U.S. government bailed it out with a $150 billion rescue package. New York-based AIG’s troubled trades were largely linked to hard-to-value mortgage debt securities, rather than the actively traded contracts that are likely to be backed by clearinghouses.This is true, and very important. With two simple sentences, Harrington and Rega informed their readers that a clearinghouse isn't a silver bullet, and that it won't even touch the corner of the CDS market that brought down AIG. Harrington and Rega's readers are now significantly better informed than readers of the New York Times and Washington Post.