Profiting on Misery 0
Bloomberg explains how certain Wall Street practices encourage the destruction of companies.
When you cut through the gibberish, it means, “The hell with stockholders, employees, customers, and the economic health of the country. I got mine.”
Following a meltdown last year in the relationship between prices on bonds and credit swaps after the Lehman Brothers Holdings Inc. bankruptcy, basis traders often stand to make the most money if companies default. They can also profit by holding the trade until the debt matures or unwinding the position after the market value gap between the bonds and derivatives closes.
This, my friends, is fiduciary responsibility and good financial citizenship at its best.
And pigs fly.