Junk bonds funded risky corporate takeovers
Michael Milken's junk bonds transformed finance in the 1980s, unlocking capital for high-stakes corporate takeovers and reshaping American business, despite their controversial legacy.
In the late 1970s, financier Michael Milken revolutionized Wall Street by pioneering junk bonds. These high-yield bonds, rated below investment grade, offered higher interest rates to attract investors willing to fund risky corporate takeovers. This innovation bypassed conservative bank lending, enabling aggressive buyouts previously unimaginable.
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