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ET Podcast #8 – Leverage and Its Discontents

Summary:
The Epsilon Theory podcast is free for everyone to access. You can grab the mp3 file below, or you can subscribe at: Spotify: https://open.spotify.com/show/3ZXOnreiGGiUtuGHzbin6d Apple: https://podcasts.apple.com/us/podcast/epsilon-theory-podcast/id1107682538 Three blow-ups in three months: Archegos, Greensill, and Melvin Capital. What do they have in common? Insane leverage employed to maximize private gain, provided by lenders that can socialize losses. ET Podcast #8 – Leverage and Its DiscontentsWe reference three archived ET notes in the podcast, linked here and taken out from behind the paywall. The Grammar of RiskLeverage / Illiquidity /ConcentrationIn a normal market you can handle two. In a bad market you can’t. If you’d like to

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The Epsilon Theory podcast is free for everyone to access. You can grab the mp3 file below, or you can subscribe at:

Spotify: https://open.spotify.com/show/3ZXOnreiGGiUtuGHzbin6d

Apple: https://podcasts.apple.com/us/podcast/epsilon-theory-podcast/id1107682538


ET Podcast #8 – Leverage and Its Discontents

Three blow-ups in three months: Archegos, Greensill, and Melvin Capital.

What do they have in common?

Insane leverage employed to maximize private gain, provided by lenders that can socialize losses.



We reference three archived ET notes in the podcast, linked here and taken out from behind the paywall.

The Grammar of Risk

Leverage / Illiquidity /Concentration

In a normal market you can handle two. In a bad market you can’t.

ET Podcast #8 – Leverage and Its Discontents

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About Ben Hunt
Ben Hunt
He is the chief investment strategist at Salient, a $14 billion asset manager based in Houston and San Francisco, and the author of Epsilon Theory, a newsletter and website that examines markets through the lenses of game theory and history. Over 100,000 professional investors and allocators read Epsilon Theory for its fresh perspective into market dynamics.

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