Everything You Wanted to Know About Credit Default Swaps -- But Were Afraid to Ask

Credit default swaps have been getting a tone of ink lately for a variety of reasons. To hear some people talk about them you'd think they were the second coming of the anti-Christ. I was recently on a conference call with George Soros who doesn't like them at all. However, people once thought the same thing about options which are now a standard method of hedging risk. So, let's see what all the hubbub is about. Let's assume that a money manager buys a GE bond, that matures in exactly 5 years