But those heady days, and Fairfield's dependence upon them, came to an abrupt end when Milken and Drexel both collapsed in 1989 in a fiscal fireball taking the junk bond
market with it.
Schmitt says a more important evaluation than how much an insurance company has invested in junk bonds
is how many of those bonds, or any of its holdings, are in default.
What do junk bonds
have to do with hostile takeovers?
Michael Milken also went to jail, but not a single charge against him involved Lincoln, the mulcting of the taxpayers, or the use of their money in creating a junk bond
market that disrupted the economy of the entire country.
However, there was some underlying concern among respondents related to the health and performance of the junk bond
Although junk bonds
command higher yields versus investment grade debt, they also come with higher default risk.
, meanwhile, have boasted yields twice that figure or greater.
, by paying investors a higher rate of return in recompense for assuming a higher level of risk, provide an effective means of bypassing traditional financing channels.
The spiritual center of the financial eighties was Drexel Bumham's annual junk bond
sales conference, known as the Predator's Ball.
Issuance of privately placed debt was robust over the last half of the 1980s, despite growth in the public junk bond
market, which many believed might supplant the private market.
The audit risk alert on benefit plans reminds auditors that the widely varying market values of stock and bond portfolios and defaults by junk bond
issuers may have a significant negative effect on the value of benefit plan assets.
The junk bond
market, which reached a frenzied peak back in 1993, fell off the following year and has slowly crawled back into corporate favor.
In many ways, our current situation parallels the junk bond
market of three years ago.
New York City and its environs have been particularly hard hit by the collapse of the junk bond
market and its impact on te financial services industry.
He has served as a frequent expert witness in complex securities and fraud cases, and as an analyst of financial fraud for Barrons, where his series of articles about the ethics of management buy-outs and issues of fraud in the Milken Drexel junk bond
scheme drew national attention.