Because stock is a call option on a firm's assets, this lost volatility would hurt the stock price of distressed banks, so they would only sell toxic assets at above market prices.
Therefore, such banks will only sell toxic assets at above market prices. Because stock is a call option on a firm's assets, this lost volatility will hurt the stock price of distressed banks.
Because stock is a call option on a firm's assets, this lost volatility will hurt the stock price of distressed banks. Therefore, such banks will only sell toxic assets at above market prices.
Because stock is a call option on a firm's assets, this lost volatility will hurt the stock price of distressed banks. Therefore, such banks will only sell toxic assets at above market prices.