Debate on derivatives, clearinghouses continues

Derivatives have been the focus of regulatory debate lately, but they remain a useful tool, said Nobel economist Myron Scholes. Banning them would be a "Luddite response that takes financial markets back decades," Scholes said. Regulators think trading derivatives through clearinghouses would make them safer, but doing so would hurt banks' profit and make certain corporate hedging prohibitively expensive.

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