Brilliant piece on the duration mismatch problem. The telecom bubble analogy is spot on but what really sticks is that we're literally building pricing infrastructure for eveyrthing except the actual compute underneath. Worked in structured credit and the idea of ABS backed by assets with accelerating obsolesence curves makes me deeply uncomfortable, espeically when the triggr is baked into the system itself.
Thanks, appreciate it. I have to say I don’t quite understand how ABS backed by assets with accelerating obsolescence curves will work. On the other hand there is so much money at stake in these deals that both lender and borrower will have an incentive to figure it out.
Brilliant piece on the duration mismatch problem. The telecom bubble analogy is spot on but what really sticks is that we're literally building pricing infrastructure for eveyrthing except the actual compute underneath. Worked in structured credit and the idea of ABS backed by assets with accelerating obsolesence curves makes me deeply uncomfortable, espeically when the triggr is baked into the system itself.
Thanks, appreciate it. I have to say I don’t quite understand how ABS backed by assets with accelerating obsolescence curves will work. On the other hand there is so much money at stake in these deals that both lender and borrower will have an incentive to figure it out.