A lot of buzz today about the possibility that bank contingent debt, which the Europeans are considering requiring as part of a general improvement of captial, will not trigger CDS contracts.

Well, yes, it won't trigger today's version of CDS contracts. But since this contingent debt won't go live for a couple of years, if even adopted, why do we assume the derivatives markets will fail to adapt?

(And while I considered using two spaces after every period to annoy the self-rightious folks at Slate, in deference to Bob, I restrained myself).