On: Credit Suisse finds ‘material weakness’ in reporti...

[bushbaba]

Because credit Susie is “to big to fail” with the CDS likely pricing in the change of a government bail out

[topper-123 → bushbaba]

Even if if doesn’t fail, the shareholderd might be wiped out though.

[HDThoreaun → topper-123]

Shareholders being wiped out doesn't affect bond holders.

[warbaker → HDThoreaun]

Usually bondholders are also wiped out during a bailout. Bailouts are generally for customers / counterparties, not investors.

Sometimes in a bankruptcy, bondholders take a "haircut" and agree to get less money back because the company simply can't pay them what they're owed.

[latchkey → HDThoreaun]

What if bond holders are shareholders?

[rblatz → latchkey]

Their share value will be wiped out, and their bonds won’t be.