4 ms·
I think the point is more that by the time the default happened, the market already considered the bonds to be worth less then what they ended up being worth.
by ant6n 9y ago
I think the point is more that by the time the default happened, the market already considered the bonds to be worth less then what they ended up being worth.
- jessriedel 9y agoThe fact that the market priced in the haircut does not mean there was no haircut. It just distributes the loss between different creditors. The bonds are just as much in default, representing a net transfer from creditors to borrowers.