That is developing in the background. (dealing with toxic loans and credit swaps)
If i understood that right, you saying this is being worked on? we needed this or months, so hopefully it is released soon!
Thanks for responding to my thread
I'm not sure anyone's actively working on it, but I wrote up a long blurb a week or two ago about credit default swaps (which can be used as insurance on your loans). The issue is really one of honesty. A shady borrower could take out a bunch of CDSes on himself (under false identities or using dishonest people) and then "default", thereby not only stealing the lender's money but forcing the insurer to pay out. It's insurance fraud, but proving that a "credit event" happened can be tricky. Usually you consider even late payments to be credit events, but there's a lot of subtlety that needs to be worked out.
I was hoping for some intelligent discussion about it (and credit ratings) but my threads didn't go very far
I'll probably write up a more detailed report of how I envision it working and post it in the next few days. It doesn't necessarily mean I'll be offering to sell/buy CDSes just yet, but I might eventually consider it once I get a better handle on things and we have a better notion of credit histories.