Detroit Bankruptcy Attracts Billionaire Investors

Detroit filed for bankruptcy last July, after decades of industrial decline. The bankruptcy was a watershed moment for the United States, and Wall Street has not ignored opportunities in the debt ridden city. Distressed debt investors of a certain bent have jumped on the city’s municipal bonds, and the heated buying hasn’t stopped there.

The involvement of large hedge funds in Detroit’s debt market may be beneficial for the city as it tries to negotiate a settlement with those holding its debt. Detroit emergency manager Kevin Orr managed to get the city’s bankruptcy through the courts without much...