House Panel Clears Derivatives Bill

The Obama administration won its first major victory Thursday in its effort to overhaul the nation's financial system as a key House committee passed a bill to regulate exotic financial instruments known as derivatives. Trading in derivatives -- contracts used to bet on the movement of stocks, bonds, commodities and other things -- magnified last year's financial crisis by forcing companies to record bigger losses as markets collapsed. But for years policymakers had rejected regulating the derivatives market, worried about stifling financial innovation.