The bond is impaired in that sense. The concept of present value isn't made up just for fun, it's because the value of money depends upon the time at which it is available. $10 in 10 years is obviously worth less than $10 right now, which is not only captured by present value calculations but it's also plainly and intuitively visible if you make the chain of associations of high interest rates -> higher price levels -> lower monetary value. So yes, if your bond sells for $87, you can be reasonably sure that $87 is the value of all of its payments back to you. It doesn't matter that the nominal payouts sum to $100, because they are denominated in future dollars which are worth less than present dollars! You need to cover the shortfall when you move those payments from the future to now!