Pre-2008 Credit Default Swaps (CDS) vs Today's Synthetic Risk Transfers (SRTs):

Pre-2008 CDS:
- Favored for speculation, not just risk hedging.
- Little transparency, weak regulation.
- Amplified systemic risk, seen in Lehman Brothers' crisis.
- Exposed significant counterparty risk.

Current SRTs:
- Lean towards risk management, avoiding speculation.
- More stringent regulation post-2008.
- Clearer structure, targeted at reducing banks' credit risk.
- Transfers risk to diverse, risk-ready investors.

In essence, changes in usage (speculation to risk management), regulation (loose to tight), transparency, and risk management approach mark the shift from pre-2008 CDS to current SRTs.

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