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Jamie Lee Cursetosis
@josh.sg

look, "we want to improve our credit profile, fundamentally or by structuring, so that we can tap buyers with higher ratings hurdles" is a cromulent treasury goal, but this graf fires the neurons in my brain that remember CPDOs and the aggressive rating arbs of 2005-07 www.ft.com/content/4ffa...

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Jamie Lee Cursetosis
@josh.sg

visualizing a GB200-backed SIV issuing AAA-rated weekly ABCP (yes I know, issuers these days are smarter about matching the funding term to the assets, no issuer would be crazy enough to take the rollover risk just to save a few bps… good lord CRWV's credit curve is steep, that's a lot of bps…)

Nicholas Weaver
@ncweaver.skerry-tech.com

And so much of these loans are bonkers (not sure about these but looking at the Google/Facebook/etc issuing). Taking assets that depreciate to close to zero in 5 years and borrowing on 30-100 year loans to acquire them.

Dave
@equanimime.bsky.social

Listening to Fink prostitute himself on CNBC for a "asset" class that will inevitably resume well-established severe depreciation drops was wild . . .

Quantian
@quantian.bsky.social

Unless it is a metonymy that I am unaware of GPUs just seem like the wrong level of asset to pledge? It would be incredibly annoying to repo, are creditors going to come in to rip them out of racks and yeet them into a truck to… where? The unoccupied and unpowered data center shell down the road?

Quantian
@quantian.bsky.social

ok but what about the power and shell? Do they have a separate priority claim above the bondholders on account of "we have the keys to the building and the pay the guys with guns onsite"? This just seems like it could get incredibly ugly fast.

Quantian
@quantian.bsky.social

It seems like you want the creditors to back the entire data centers individually as project level finance, and then separately have NVIDIA write a put on terminal value to cover “oops our new chip is 10x more powerful so you need to scrap all the GBs out and replace them with VRs”