It would appear that in the order of who knows what when, in the case of JCPenney, it is C-level executives first [5], credit markets second (was Goldman's line a pre-DIP?), and equity shareholders (Ackamn included) last. With the torrent of executve departures in the last year, credit market investors led the equity over the past two weeks as credit lines were (allegedly) pulled. Today's 50bps rise in JCP's 5Y CDS pushes the company's risk of bankruptcy to its highest ever (arguably higher than 65% over the next few years given the secured assets). JCP's stock is down 2% on the day but still holding above its April (and 2009) lows (for now).
[6]
Charts: Bloomberg