What Is Really Behind The Pope’s Denunciation Of OTC Derivatives?

The Vatican and Pope Francis issued a blistering denunciation against over the counter (OTC) derivatives Thursday. While at first glance the move by a religious order to weigh in on a complex financial topic caught some Wall Street observers by surprise, the announcement was the result of years of study and consternation by those working around the Holy Se. With Spanish and Italian debt default threatening the European Union, Thursday’s holy pronouncement, one of the highest level statements the Vatican could send, comes as a topic seldom discussed in the public domain moves closer to becoming a global concern.

In the...