Junk Bonds, Mortgages and Milken - New York Times

There is almost no chance of me not posting an article on Milken. While far from perfect, the US economy still owes him a large debt for his role in the creation of active public debt markets for low and unrated firms. What it did was to help force management to look out for shareholders, else face the consequences of a possible takeover.

Junk Bonds, Mortgages and Milken - New York Times:

"Critics who compare the subprime debacle to the bubble in high-yield, high-risk corporate bonds that Drexel helped inflate two decades ago are “people who don’t understand markets very well,” Mr. Milken said. He suggests that “their rationale is that both types of financial instruments are risky.”

And he says junk bonds, or those rated below investment grade, “have little in common with mispriced subprime mortgages,” which he says are the real culprits."

Yeah I know, insider trading changed the way history will look at him, but we should not forget his contributions. (no one is all good or all bad.)