Asset Backed Finance Guy

One of few companies I hope God himself strikes down

@praetoriancap @taobanker Just curious but what’s the Sharpe here?

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@rubicon59 @undrvalue @jordibausch Largely due to margin compression on the production ramp up. I’m more concerned with management’s seeming lack of professionalism / amateurish behavior with public analysts than I am about the fundamentals. Why are you so bearish?

@undrvalue @jordibausch Used to be a reliable grower, but dissapointing earnings lately.

$PSIX seems interesting here. Why so punished?

One of the often slept-upon benefits of attending the University of Chicago is that they make you read Marx as part of the core curriculum, which is why this article gave me flashbacks of taking SOSC 114 as a freshman. Marx, writing during the Industrial Revolution, predicted capitalism would periodically devour itself: firms replace labor with machinery to boost profits, but competition diffuses the technology, drives prices to marginal cost, and the gains get competed away. Meanwhile, displaced workers lose purchasing power, hollowing out the demand the whole system depends on. Production rises but no one can afford to buy what's produced - the contradiction between production and realization. Citrini's piece describes this exact dynamic, then declares there's "no natural brake." It's the most Marxist piece of financial analysis written in years, and makes the same errors Marx did. Schumpeter offered the obvious rebuttal 80 years ago: creative destruction doesn't just destroy, it creates industries we can't yet conceive of. Everyone in the replies is already making this point, and I think they're right. But the sharper rebuttal is Hayek's: prices are the brake Citrini says doesn't exist. Who funds $200bn / qtr in AI capex when equities are down 38%, private credit marks are in the 50s, and consumer demand has collapsed? Cost of capital rises. Incremental build-out becomes uneconomical. Capital gets destroyed and reallocated. Citrini also unknowingly describes Marx's proletarianization of the petite bourgeoisie: the $180k PM driving Uber is textbook. But the article claims this collapses consumer demand, and that's where it breaks. The top decile drives 50%+ of spending and their wealth is in equities, not W-2 income; they're long the hyperscalers posting records in Citrini's own model. Blue collar is insulated because AI replaces cognitive labor, not physical. The professional middle class gets crushed, but aggregate demand doesn't. The spending class IS the capital-owning class. The K-shaped recovery they fear actually stabilizes the demand base they say is collapsing. In the stable aggregate demand, the petit bourgeoisie finds ways to reinvent itself. I think the Citrini piece is excellent and worth reading. But history has repeatedly shown that periods of transformative productivity gains ultimately accrue to the consumer through lower prices, more leisure, and higher quality of life. Marx's error wasn't diagnosing the disruption, it was underestimating the system's ability to adapt.

@WillManidis Truly a masterful work

Whenever I hear someone say that private credit is a bubble, I ask them what that means for private equity At least 90% of the time, they don’t have a good answer and fail to even realize that debt sits above equity in the cap table waterfall If you think private credit values are going to be impaired, that means all the equity underneath (which mostly is PE sponsors) has to be a zero first So believing that private credit is a bubble would imply that everything in private markets is a bubble And if that is true, then I would argue that VC valuations are a much bigger source of the bubble than PE, purely based on the multiples that are being paid on the big AI company rounds

Naval is like a bootleg Taleb with less aura.

This is what midwits will ask you because their idea of intelligence is memorization vs actual conceptual/problem-solving intelligence.

All nuance being obliterated from the mkt means no one really cares about doing "real work". This is a harsh truth missed by ppl who over-intellectualize analysis. Increasingly more of the mkt is incentivized by a "make $ every day" mandate, which only exacerbates it...

@taobanker This is ridiculous - name a class of products that have on average deteriorated in quality

Okay this is actually thought provoking we're experiencing hyperdeterioration of quality instead of hyperinflation of purchasing prices

“Deep fundamental work most LO shops do”

@bubbleboi I say this only partially tongue in cheek, but

So it happened… my bubble has finally popped. I knew this day would come, I was preparing for it mentally. But I didn’t expect to get hit this hard… I am licking my wounds for now and taking a step back and get my head straight. I had a good run and the past six months were electric but I’ve been working myself to the bone chasing money while neglecting my loved ones. To those I ignored, I’m sorry. To those I hurt, I hope you can forgive me one day. To the people who are writing me off and discounting me.. do so at your own risk. The only thing I’m too stupid to do is give up!!!! Goodbye for now ✌️ ❤️🫧

@bubbleboi MANIFEST GOOD NEWS ON THE CALL

WILL BE STREAMING LISTENING TO THE EARNINGS CALL 📞 30 MINUTES. BIG BIG PROBLEMS !

@SpecialSitsNews @LeylaKuni This has been around for two decades it’s not really a shocker to anybody in structured credit

@LeylaKuni saw a live presentation on this...had to try so hard to keep my mouth shut

So I previously thought I'd seen it all. I was mistaken. May I introduce Collateralized Fund Obligations (CFOs). A CFO involves the issuance of rated debt and equity securities collateralized by a pool of limited partnership stakes in private funds. It's like CLO/CDO, but stakes in funds as collateral inside the securities, instead of loans 🤯 Lord almighty... (source: PJT Partners)

@hamptonism Please stop LARPing it’s so cringe

pov: you dropped out of Yale, moved cross country to NYC, raised $800 million for your Quant Fund, and now collect $20 million in interest from stochastic volatility modeling hyperbolic PDEs with Dirac Delta vol spikes via finite difference grids with a couple math olympiads.

@Merridew__ Wage growth has been higher than inflation (with deceleration only occurring in the last 6 months) - K-shaped economy is largely psychological as wage growth is viewed as “earned” while inflation is “suffered” - people are mentally anchored to 2019 prices.

Biggest Intel bull in the world — Donald J. Trump

Memory posts be like I've modelled out EPS into 2028, and I think they might do $120 of earnings