An earlier version of this paper was prepared for the Federal Reserve Bank of Boston's conference on “Are Distinctions between Debt and Equity Disappearing?” in October 1989 and published in the conference proceedings: R.W. Kopke and E.S. Rosengren, Are the Distinctions between Debt and Equity Disappearing? (Federal Reserve Bank of Boston, 1990). This version contains expanded explanations of several points. Also a few anachronisms have been eliminated.