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All true, and arguably TC should’ve gone bust a lot earlier. Bonds have been pricing in a low recovery for a long time which implies equity is worthless. I suppose my real point is that the hedge funds involved had a vested interest in bringing the company down. They effectively forced the...

I totally agree with your point on banks not throwing good money after bad - its pointless on a busted flush with a flawed business model. It would've gone at some point anyway. But CDS in this case was not used to insure or hedge. It was taken as an outright position with a view to moving the...

I’ve only gone this far down the thread but this is the real reason they went bust. Hedgies have been shorting the shit out of CDS and running basis trades on the equity. I find it amazing our so called intelligent financial press haven’t picked up on this at all. Yes you could blame...