What is my house "worth"? Is it worth what I paid for it plus improvements? Is it worth what I could sell it for? Is it worth what an appraiser says?

I'm lucky. I could probably sell my house for about what I think it's "worth". Lots of people are upside-down on $400k mortgages, in houses that wouldn't bring $200k in today's market. Their investment failed to perform. I don't see anyone writing bailout legislation to "fix" that problem. And they didn't lose the $600k they thought they would sell for, they lost the $400k they put in.

All these CDSs were investments. They failed to perform. They lost their investment, not the hoped-for future value of it.

You know, Bush signed lots of presidential orders and "signing statements" saying that regardless of the actual legislation, his administration would not prosecute certain activities. In the same spirit, congress could pass legislation saying that that activity is now (again) illegal. And that while the CDS contracts were valid, no federal court would assist in enforcing the terms of one written before the change. Declare the terms "unconscionable" and be done with it.