Looking at this more, I think I my uncertainty is resolving towards “No”.
Some things: - It’s hard to bet against the bonds themselves, since we’re unlikely to hold them as individuals - It’s hard to make money on the “this will experience a sharp decline at an uncertain point in the future” kind of prediction (much easier to do this for the “will go up in price” version, which is just buying/long) - It’s not clear anyone was able to time this properly for Detroit, which is the closest analog in many ways - Precise timing would be difficult, much more so while being far away from the state
I’ll continue to track this just because of my family in the state, though.
Point of data: it was 3 years between Detroit bonds hitting “junk” status, and the city going bankrupt (in the legal filing sense), which is useful for me for intuitions as to the speed of these.
Looking at this more, I think I my uncertainty is resolving towards “No”.
Some things:
- It’s hard to bet against the bonds themselves, since we’re unlikely to hold them as individuals
- It’s hard to make money on the “this will experience a sharp decline at an uncertain point in the future” kind of prediction (much easier to do this for the “will go up in price” version, which is just buying/long)
- It’s not clear anyone was able to time this properly for Detroit, which is the closest analog in many ways
- Precise timing would be difficult, much more so while being far away from the state
I’ll continue to track this just because of my family in the state, though.
Point of data: it was 3 years between Detroit bonds hitting “junk” status, and the city going bankrupt (in the legal filing sense), which is useful for me for intuitions as to the speed of these.