Manipulating Codere December 7, 2013 at 12:33 pm
Blackstone Group LP bought credit-default swaps on troubled Spanish gaming company Codere SA, then agreed to roll a $100 million revolver for Codere on favorable terms in exchange for Codere agreeing to make an interest payment on some bonds two days late, thus creating a technical default and triggering the CDS, pocketing some gains for Blackstone at the expense of the CDS writers, without costing Codere anything
Now I am perfectly prepared to believe that this might not be market manipulation and that nothing actionable happened here. But if it wasn’t, why not? I mean, is this really ethically different from banging the close?