P.100 of Vol 4: Does the answer for the primary market analysis contradict with the counter-intuitive conclusion mentioned in primary market analysis on page 69? I am confused which the spread is supposed to go given more issuance of new bonds!
I believe additional supply validates the prices of the bonds and thus increases their value and reduces spreads.
Right, that is the logic of the text on page 69, but seems not exactly same as on page 100, how do u think?