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That's funny, because of the two terms, "junk bond" seems to me to be the more accurate and descriptive one, while "high-yield bond" seems like a deliberately d
by Analemma_ 9y ago
That's funny, because of the two terms, "junk bond" seems to me to be the more accurate and descriptive one, while "high-yield bond" seems like a deliberately deceptive euphemism.
- jakelarkin 9y agohttps://en.wikipedia.org/wiki/Bond_credit_rating https://en.wikipedia.org/wiki/Bond_credit_rating when major banks/investors refused to deal with BBB or lower they called it 'Junk'. When they realized 1) the credit risk can be safely managed with modern financial theory and instruments 2) there was money to be made ... they quickly adopted it and had to figure something out to drop the 'Junk' pejorative.
- nqzero 9y agojunk implies zero value, which is very far from accurate