4 ms·
Right, but if they're expected to be toxic you would mark them down nominally as well. It's not like the real losses aren't also nominal when realized. And whe
by nostrebored 4y ago
Right, but if they're expected to be toxic you would mark them down nominally as well. It's not like the real losses aren't also nominal when realized.
And whether the metric you care about is the real losses or the expected nominal value at maturity depends on whether inflation continues to raise. As this also suggests interest rates increase, you get hammered on both sides.
- s1artibartfast 4y agoNo, because they still are with the same number of dollars, it it just that the dollar itself is worth less that it was. If you say you have $100 worth of bonds, this is accurate at all points of time you hold it. What you can buy with $100 may be changing from year to year.