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Einhorn: CDS Part Of The Communist Conspiracy

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Having already made his millions on credit-default swaps, David Einhorn wants to see a last call on the controversial derivates.
In his recent speech to the Value Investing Conference, the Greenlight Capital founder lambasted CDS, blaming them for a whole array of social problems and calling them a slippery slope toward Stalinism. What to do with such a social virus? Stamp it out.
"I think that trying to make safer credit-default swaps is like trying to make safer asbestos," Einhorn said. Quite a statement from one of the hedge fund chieftans who earned the ire of many a Wall Street CEO during the height of the financial crisis, in effect agreeing that CDS are un-American.

Un-American and deeply red, the Cold Warrior claims. Even a CDS clearinghouse won't do the trick, because that would simply create "socialized risk." And with socialized medicine on the horizon, we can't afford to turn Wall Street over to the pinkos.
Hammering home the point that CDS are simply the back door to the U.S.S.A., Einhorn calls them "anti-social," and he should know. Investors like him "have an incentive to use their position as bondholders to force bankruptcy," rather than some more capitalistically constructive end.
Greenlight Capital founder calls for CDS ban [FT]



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