alt Hacker NewsWhy aren't the PE firms buying this debt right now though, before Oracle is downgraded? Isn't that a better purchase?
(Sincere, not rhetorical questions)
Replies
cmiles8 • yesterday at 8:57 PM
Because the general consensus at this point appears to be that the notes will fail. You wouldn’t buy a loan if you thought it wasn’t going to be repaid.
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Because assuming the premise is true, there will be a dip in bond prices (ie. higher yields) when oracle gets downgraded, because pension funds or whatever have to dump their holdings. You buy the dip, not at the top.