He gave no details of how the system might work or when it may start operating. But he said: 'Despite abuses, the junk bond remains a wholly desirable type of capital market instrument in providing substitutes' to bank credit.
The SEC and the National Association of Securities Dealers have been trying for several years to develop a junk bond trading system that would limit possibilities for fraud.
Junk bond trading fell into disarray after the fall of Michael Milken and the failure of his firm, Drexel Burnham Lambert, the leading market maker. Last week, the investment bank Merril Lynch said sales this year were likely to be a record, topping the dollars 31.9bn sold in 1986.Reuse content