37 karma · joined August 8, 2017
[0] See p. 1193 et seq. of this article: https://law.stanford.edu/wp-content/uploads/sites/default/fi...
[1] https://en.wikipedia.org/wiki/History_of_firefighting#Early_...
No. Insurance is subject to the "insurable interest" doctrine, which generally prohibits using insurance as naked speculation. There are also far more backstops, reserve requirements, government guarantees, etc., designed to prevent this kind of implosion. Not saying it doesn't happen, but we've had since the South Sea Bubble to learn how to regulate insurance to prevent this kind of thing.
The key difference is that insurance is generally regulated from a consumer protection perspective, since many insurance lines are sold directly to unsophisticated consumers. CDSs are, by contrast, sold primarily these days to sophisticated financial speculators, who are presumably fully aware of the kinds of risk involved.
[1] https://docs.google.com/document/d/1Bg_1m1C05YqTJzp5MBZMhlRE...
Adding colored tags[2] and the Workflowy Code Formatter extension[1] makes it really great.
[1] https://chrome.google.com/webstore/detail/workflowy-code-for...
[2] https://chrome.google.com/webstore/detail/painter-for-workfl...
[1] https://dymaxion.org/essays/briarvision.html previously discussed at https://news.ycombinator.com/item?id=18027949