@mispriced.assets: The Smart Money is the Subprime this Time

Andy :

I’ve been seeing a lot of Greenwich homes with ikea furniture we’re getting close

** :

Can you do this again but talk to me like a 10 year old? No joke - I understood 50% and now intrigued but lost

Willy :

Don’t worry. While the wealth doesn’t trickle down, the losses certainly will.

ℕ𝕒𝕥𝕙𝕒𝕟𝕚𝕖𝕝 :

Most unexpected 11pm fyp pull. Niche insider fund dynamics while repping the Shinnecock apparel.

timkim_tk :

As an auditor in the space, the worst thing I see is the underlying investments are not even cash flow positive. Everyone is just praying they can make a sale some time in the future.

J_263 :

Deal is levered, the fund has a bridge loan for each investment, then there is a NAV loan, the co-invest is levered itself, and the LPs are levered. Its leverage on top of leverage

. :

in other words we’re in a bubble

Twman1113 :

I work for a mid-size alt credit shop. We have a fund that does GP financing and that’s 1-1.5x levered, we have another fund that provides leverage to funds that provide leverage. The amount of hats on top of hats on top of hats is insane.

Aristotle505bc :

Sounds very CDO and 2008ish

beyutch :

So this is my takeaway from a lay perspective: I have a fund that invests in rocks from my driveway. Many are saying that these rocks will be worth millions each in the coming years !! Based off that I’m giving my rock collection a valuation of $20 mil. And the fund could really use another $60 mil in financing to purchase more rocks. And it would be great if I could also get a personal loan with my stake in the fund as collateral so I can invest back into it and help get even more rocks !! Am I close ? Cause it sounds like these firms are leveraging billions off peanuts and are then forcing their execs to get in on the fun.

gabbbagool_ :

this sounds like a pyramid scheme inside of a bubble

Me :

Isn’t this called “a Texas hedge“?

Commonlykyle :

It’s money in a computer that doesn’t exist

Wally - Toy Aussie :

This is EXACTLY correct. I’ve never seen anyone describe this as well as you just did.

PMG :

First dude to explain ball knowledge without being a dork. Thanks for the info

M :

This is incredible. So they’re getting so high on their own supply?

lumpy2432 :

They take out loans as a tax strategy

Adam Thompson :

Dude if you put out a video explaining this like the Big Short does with celebrities it will go viral

darell issa rae :

Bryan O'Rourke :

and the firms are now at over 7 year holds and they are living off the mgmt fees

Keke :

I think we’re at the point where risks and rewards are no longer arriving on the same timeline

martvents :

High stakes, hot potato

Sasha Guillaume :

this is brilliant... someone, who has more technical knowledge than me, should do a post about how proformas are useless but banks keep leanding money on them

b3eeeeees :

which is why our leader wants to hyperinflate things as opposed to let the markets take a little dip

pab :

Lmk when u start buying default swaps