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The producer’s $1.5 billion of 4.875 percent notes due in April 2022 dropped 9.625 cents this week to 50.375 cents on the dollar, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.

Explain it to me like I'm five, please, these subordinances are very hard to get.

  • Explain (it) to me. – NES Nov 15 '15 at 21:21
  • One valid interpretation: The producer’s $1.5 billion (of ((4.875 percent notes) due in April 2022) ) dropped 9.625 cents (this week) (to 50.375 cents on the dollar), (according to Trace, (the bond-price reporting system (of the Financial Industry Regulatory Authority))). – Nonnal Nov 15 '15 at 21:31
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    You'd be better off checking out an explanation of bond trading than asking here. In short: producer's 1.5 billion of yet-to-be redeemed 4.875% interest notes, which are due-to-be-redeemed to April 2022, dropped from 60 to 50 cents on the dollar. This is according to Trace, reported by FIRA. It generally indicates a lack of faith in that particular company for one reason or another. – Misneac Nov 15 '15 at 21:35
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'producer' refers to a company producing something. 'notes' refers to a (bond-like) financial instrument issued by a company (rather than a government) giving creditors interest for a period of time (the rate is fixed so it drops in value as interest rates rise and vice-versa).

We thus have a noun 'notes' with modifiers identifying the total value of the notes ($1.5B) the interest rate (4.875%) and the expiry date (April 2022).

Grammatically the "subject" is $1.5 billion, semantically the "actor" is the value of each note. These would be used in the singular, e.g. "has dropped". However, pragmatically we can also regard the notes (by metonymy+metaphor) as dropping (in value) and as a plurality (more than one) and thus use plural agreement, viz. "have dropped". This "perfect" tense with "have" would emphasize the change of state, whereas the simple past "dropped" just notes that is happened.

We thus have a clause (indirectly quoted sentence) saying effectively "the company's notes have dropped 9.25 cents each" + info on which, when and how much.

The second half, introduced by a participle (-ing word) says who said this. The source, introduced by "according to", is Trace (turns out not to be a person). Trace is identified as the name of a system for reporting on bonds (and notes). FIRA is identified as the owner/operator/originator of this system.

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    Notes is also used here to mean 'the price of the notes'. This is so common in financial circles that most people using it don't even realize that it is metonymy/transferred meaning. – TimLymington Nov 16 '15 at 0:00
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You are looking at a bond listing on Trace (a reporting system) for a company referred to as "the producer". They have notes that return 4.875% (meaning $1000 becomes $1004.88) on April 1st, 2022.

Last week they were 60.100 cents on the dollar and they dropped 9.625 cents over the week. Now they are at 50.375 cents on the dollar. That means that you can pay $503.75 for $1000 in bonds, which will pay out at $1004.88. You will double your money, making $501.13, if you wait until 2022 to redeem the bond.
$1004.875 payout - $503.750 investment = $501.125 profit

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    You’ve parsed the sentence correctly, but corporate bonds work a little differently than that. This is likely a fixed-rate bond. These bonds pay a fixed annual interest rate usually in six-month or sometimes monthly installments up until their maturity date. So people purchasing the 4.875% note will receive ~$48.75 each year until 2022 regardless of the price of the note. The price of the note affects the note’s overall yield st maturity but not the fixed interest payments. – Jim Nov 16 '15 at 6:02

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