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Why Citi's 11% Coupon Doesn't Mean it's Paying Junk Rates
by Felix Salmon
Nov 27, 2007
Nov 27, 2007
I didn't actually post my first entry of the day at 10:20 this morning, honest: Movable Type seems to have eaten my real first post, about the Abu Dhabi investment in Citigroup. My blog entry compared the 11% coupon on that deal to the 7.5% coupon that Bank of America is getting on its Countrywide investment. It was cheap and snarky, but hey, what do you expect first thing in the morning.
In any case, I didn't really need to go there: everybody else, it turns out, had the same idea. Most journalists, however, alighted on 9% junk-bond yields as the proper comparison.
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