Banks Take Partial Write-Downs on Greek Debt, Why Not With AIG?

Floyd Norris has an interesting piece discussing the credit default market in European debt. He notes that the volume of issuance has not increased in recent months even as spread between the interest paid on the bonds of heavily indebted countries and Germany has increased. (France is an exception, which is easily explained by people wanting to bet that its situation will deteriorate.)

Norris explains the limited issuance as likely being the result of the way in which Greece's debt is being ...