Gilts Gone? October 14 | Aussie Stock Forums

Where capital was not incoming quickly enough, pooled LDI funds would have been forced to deleverage by selling gilts at levels far exceeding the normal daily level of gilt trading into an illiquid market. (Some funds had already tried to sell gilts and failed to do so.) With the gilt market unable to absorb further large sales, had large sales been
1 Margin requirements are a vital part of the financial system to manage counterparty credit risk.Bank of England Page 7
attempted yields would have been pushed even higher, forcing further gilt sales in an attempt to maintain solvency. This would have led to a self-reinforcing spiral of price falls and further pressure to sell gilts.