Ordering chaos

From the Procter & Gamble mis-selling scandal and collapse of Long-Term Capital Management in the 1990s, to last year's implosion of Amaranth Advisors, the past 20 years have seen an array of derivatives-related crises and hiccups. What impact have such episodes had on the derivatives industry? By Navroz Patel

Ask anyone to draw up a list of the top 10 financial crises and it's likely that derivatives would feature fairly prominently. Cincinnati-based consumer products giant Procter & Gamble's (P&G) $157 million loss on complex interest rate swaps in 1994, the collapse of hedge fund manager Long-Term Capital Management in 1998, and more recently the multi-billion-dollar failure of hedge fund manager