ET Podcast #8 - Leverage and Its Discontents
Epsilon Theory
April 2, 2021·3 comments·epsilon theory archive
Three blow-ups in three months: Archegos, Greensill, and Melvin Capital.
What do they have in common?
Insane leverage employed to maximize private gain, provided by lenders that can socialize losses.
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> Insane leverage employed to maximize private gain, provided by lenders that can socialize losses.
A spot-on observation like that deserves immediate translation into Esperanto:
“Freneza levilado utiligita por maksimumigi privatan akiron, provizita de pruntedonantoj kiuj povas socialigi siajn perdojn.”
I found the discussion interesting thank you. I somehow feel that the narrative about the “private” investor coming into the market to provide idiosyncratic opportunities to be a bit naive! we should improve the analysis: If people have not worked out that Robin hood and co. we should help: they are the best allies of Wall Street and they are not a casual occurrence, they are the conduit from what once was a bucket shop to financial markets. the narrative about them needs to be rectified: these tools that are simply luring into the game the greater fools and allowing them to leverage beyond this solar system… happy Easter everyone
When you’re among wolves, you must bay at the moon.
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