Credit Derivatives Unfairly Scapegoated

From Reuters:

Credit strategists at ING said on Thursday that credit derivatives were being unfairly blamed by politicians and commentators for the near meltdown of financial markets..."The CDS (credit default swaps) market is being used as a scapegoat for political and economic goals," ING credit strategist Jeroen van den Broek wrote in a note to investors.

Quite right too, and I have been saying so for months. This particular goat (sheep, whatever) is pretty safe.

Update. As per my earlier post, Reuters reports that the Lehman settlement is a non-event. There a nicely written elaboration from Felix Salmon on portfolio.com here, and a broader FT alphaville defense of derivatives here.