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It would be more analogous to some state announcing it will not bail out a state-sponsored corporate enterprise, and instead allow it go bankrupt in a downturn.
by JamesianP 4y ago
It would be more analogous to some state announcing it will not bail out a state-sponsored corporate enterprise, and instead allow it go bankrupt in a downturn. From another perspective it is sanity, protecting taxpayers from being on the hook for speculation. The entire complaint here hinges on some kind of butterfly-effect argument, plus the precise wording of a "guarantee" that was only pointed at vaguely in the article.
- ender341341 4y agoIf the state won't follow through on it' guarantees in this case why would you assume they will on others, that guarantee is why investors are willing to take lower rates on those bonds in the first place.