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This might be an example of the downside, albeit even in this case there are important caveats that people have pointed out... There's a plethora of examples of enormous upside of government sanctioned private monopolies that resulted in monumental progress for consumers. EDIT: Basically...

It's not the BoJ. It's the various Japanese investors who recycle JPY they get from the BoJ into various foreign assets, such as Treasuries.

Well, I shirley hope not...

This isn't entirely correct... Firstly, the $160bn AUM is split roughly 50/50 between Pure Alpha and AllWeather. Secondly, the above description of the risk parity strategy is, shall we say, a little misleading. Thirdly, it's true that the recent regime has been particularly friendly to risk...

If you wanted to be charitable to the HF community, you could say that, oftentimes, the art isn't in finding what to buy/sell, but in finding when and how much. That is to say, HFs might argue to their investors that they're good at market timing and/or that they know how to optimise their...

No, just no...

Fundamentally, what you ask is impossible, by construction... There is NOTHING you can do, because this is the nature of the option contract and the nature of the trading strategy that you're employing to generate profit. Basically, once you've knowingly and consciously decided to put your...

Cash isn't particularly expensive... All sorts of vol is pretty cheap. Nobody wants nether of 'em.

It's very expensive, but peeps love it...

Yeah, I guess you have to price in the risk of your collateral being valued at 0 at the time of default...

Thank you for the numbers... To be honest, I've looked at some aircraft lease-related investments that had attractive yields, especially given that they're secured (aircraft itself was the collateral). So I was sorta curious about this one. I wonder what this Deer Jet's (or is it Dear Jet?)...

You don't get positive carry from thin air. You get positive carry for taking FX risk.

The numbers quoted were kinda interesting... Apparently, the jet costs $300mm to purchase and can be rented for $74k/hr. Assuming that this is $74k per flight hour and that, conservatively, the plane spends 5 hours on the ground for every flight hour, it might represent an asset with an...

I meant cumulative prem received was arnd $5 - 6mm...

Bigly flows, buyers of duration...

You might be thinking of Ruffer, the famous "Mr Fiddy"... I don't think he's the guy behind this concoction. And it was definitely a short put vs a 1x2 call spread, 12, 15 and 25 strikes respectively. The initial credit was smth like $5 - $6 bucks. I'm not sure how much it cost to roll last...

Well, people in Eastern Europe tried to do this with their mortgages by borrowing Swiss franc... It didn't end well. There are lots of risks that you will be running in this scenario. Most important of those is your FX risk, rather than anything to do with interest rate differentials.

This is an old trade, which has been already rolled once. There's a whole older thread on it. The "massive volume" due to this position being rolled the first time didn't do anything special, so I am not really sure what the excitement is all about.

I think that's kinda been my point as well. If you're stressed (especially, chronically), it's reasonable to expect that you might soon be dead. In which case current payoff is all you care about and risk associated with it doesn't really matter.

To be fair, the fact that DoucheBank was able to get away with the sort of blatant skullduggery described in the article on such a grand scale was mildly newsworthy, IMHO.