The Existential Imperative to Borrow

The Existential Imperative to Borrow Joe Weisenthal and Tracy Alloway More yield-insensitive issuance. Hello and welcome to the newsletter, a grab bag of daily content from the Odd Lots universe. Sometimes it’s us, Joe Weisenthal and Tracy Alloway, bringing you our thoughts on the most recent developments in markets, finance and the economy.

And sometimes it’s contributions from our network of expert guests and sources. Whatever it is, we promise it will always be interesting. If you like chatting with us, check out the Odd Lots Discord, where you can hang out and talk with us and with other listeners 24/7.

Last week, we released an episode with Luke Kawa talking about what’s going on in markets right now. During our conversation, I made an aside about how Big Tech companies and hyperscalers are insulated from higher rates than other businesses. This prompted some pushback online.

It seems obvious to me that a company that generates loads of cash is going to be better able to absorb higher borrowing costs compared to other businesses. While hyperscalers are indeed issuing tons of new debt, they are still throwing off plenty of cash relative to other companies. That said, I also think the key thing to emphasize here is that the collective impulse of hypscalers to borrow is itself rate-insensitive (so far).

As Matt King over at Satori Insights puts it: “The issue is less the volume of current borrowing than the desire.”With the AI race couched in existential/winner-takes-all terms (“Whoever has the best model, wins”) there’s basically no upward limit on the hypothetical amount of money these companies need to fund their respective AI buildouts. A higher cost of capital may force these companies to get more creative in their financing mix, but it doesn’t change the strategic imperative overall. What’s interesting here — getting back to something Joe wrote last week — is that the same is arguably true of many democratically-elected governments.

Yields are going up on sovereign bonds, but there are few governments anywhere in the world that look willing to sacrifice their respective popularity in the name of serious fiscal austerity. With so much of the political agenda now also wrapped in existential terms (“We must spend now on capacity, in order to survive later”) there’s a similar dynamic at play. Put it altogether and what you get is a lot more yield-insensitive issuance from both governments and hyperscalers, who feel they must keep borrowing to survive, crashing into a buyer-base for debt that is actually more sensitive to price.

We know that hedge funds have become a bigger part of the buyer base for US Treasuries, for instance. “The problem is less a lack of appetite than a shift away from central banks and liability matchers towards investors with a real choice of what to buy,” says King. One broad way of looking at the current bond environment is as a place where issuers who feel they have no choice but to borrow are running headfirst into buyers who feel they have a rapidly-expanding array of investment options. Speaking of bonds, isn’t it weird that bonds have become more “stock-like” lately? It’s a question the really sits at the center of lots of market discourse, and it generates a few other questions: What happens if investors can no longer hedge stocks with government debt? And what explains the global selloff in bonds if bonds are now “riskier”? Today’s guest, Carolin Pflueger, associate professor at the University of Chicago and a resident scholar at the Chicago Fed, talks to us about how the Fed’s “reaction function” and the institution’s credibility might play a role in making bonds more “bond-like” again.

Watch: Bloomberg / You Tube Listen: Apple / Spotify Enjoying Odd Lots? Check out these newsletters: You have exclusive access to other subscriber-only newsletters. Explore all newsletters here to get most out of your Bloomberg subscription.

The Existential Imperative to Borrow Joe Weisenthal and Tracy Alloway أكثر إصدار insensitive للعائد. مرحبًا بك في النشرة، كيس من المحتوى اليومي من odd lots universe. Sometimes it’s us, Joe Weisenthal and Tracy Alloway, bringing you our thoughts on the most recent developments in markets, finance and the economy. And sometimes it’s contributions from our network of expert guests and sources.

Whatever it is, we promise it will always be interesting. If you like chatting with us, check out the Odd Lots Discord, where you can hang out and talk with us and with other listeners 24/7. Last week, we released an episode with Luke Kawa talking about what’s going on in markets right now.

During our conversation, I made an aside about how Big Tech companies and hyperscalers are insulated from higher rates than other businesses. This prompted some pushback online. It seems obvious to me that a company that generates loads of cash is going to be better able to absorb higher borrowing costs compared to other businesses.

While hyperscalers are indeed issuing tons of new debt, they are still throwing off plenty of cash relative to other companies. That said, I also think the key thing to emphasize here is that the collective impulse of hypscalers to borrow is itself rate-insensitive (so far). As Matt King over at Satori Insights puts it: “The issue is less the volume of current borrowing than the desire.”With the AI race couched in existential/winner-takes-all terms (“Whoever has the best model, wins”) there’s basically no upward limit on the hypothetical amount of money these companies need to fund their respective AI buildouts.

A higher cost of capital may force these companies to get more creative in their financing mix, but it doesn’t change the strategic imperative overall. What’s interesting here — getting back to something Joe wrote last week — is that the same is arguably true of many democratically-elected governments. Yields are going up on sovereign bonds, but there are few governments anywhere in the world that look willing to sacrifice their respective popularity in the name of serious fiscal austerity.

With so much of the political agenda now also wrapped in existential terms (“We must spend now on capacity, in order to survive later”) there’s a similar dynamic at play. Put it altogether and what you get is a lot more yield-insensitive issuance from both governments and hyperscalers, who feel they must keep borrowing to survive, crashing into a buyer-base for debt that is actually more sensitive to price. We know that hedge funds have become a bigger part of the buyer base for US Treasuries, for instance. “The problem is less a lack of appetite than a shift away from central banks and liability matchers towards investors with a real choice of what to buy,” says King.

One broad way of looking at the current bond environment is as a place where issuers who feel they have no choice but to borrow are running headfirst into buyers who feel they have a rapidly-expanding array of investment options. Speaking of bonds, isn’t it weird that bonds have become more “stock-like” lately? It’s a question the really sits at the center of lots of market discourse, and it generates a few other questions: What happens if investors can no longer hedge stocks with government debt? And what explains the global selloff in bonds if bonds are now “riskier”? Today’s guest, Carolin Pflueger, associate professor at the University of Chicago and a resident scholar at the Chicago Fed, talks to us about how the Fed’s “reaction function” and the institution’s credibility might play a role in making bonds more “bond-like” again. Watch: Bloomberg / You Tube Listen: Apple / Spotify Enjoying Odd Lots? Check out these newsletters: You have exclusive access to other subscriber-only newsletters.

Explore all newsletters here to get most out of your Bloomberg subscription.

The Existential Imperative to Borrow Joe Weisenthal and Tracy Alloway আরও উৎপাদন-insensitive jarixon। হ্যালো এবং স্বাগতম নিউজলেটারে, Odd Lots বিশ্বের দৈনিক কন্টেন্টের একটি থালা। কখনও কখনও আমরা ourselves, Joe Weisenthal and Tracy Alloway, আপনাকে বাজার, finance এবং অর্থনীতির সবচেয়ে নতুন উন্নয়ন নিয়ে আমাদের মতবা দিচ্ছি। এবং কখনও কখনও এটি আমাদের অভিজ্ঞ অতিথি এবং সোর্সের নেটওয়ার্ক থেকে অবদান। যেকোনো বিষয় हो, আমরা আমাদের 약속 দিয়েছি সবসময় এটি আকর্ষণীয়। যদি আপনি আমাদের সাথে চ্যাট করতে পছন্দ করেন, তবে Odd Lots Discord পরিদর্শন করুন, যেখানে আপনি 24/7 আমাদের এবং অন্যান্য শ্রোতাদের সাথে বিতর্ক করতে পারবেন।গত সপ্তাহ, আমরা Luke Kawa সাথে একটি Épisode প্রকাশ করেছি বাজারে কী হচ্ছে সাবout আলোচনা করছে। আমাদের কথাবার্তায়, আমি একটি aspect সম্পর্কে একটি বাহ্যিক মতবা দিয়েছিলাম Big Tech কোম্পানিরা এবং hyperscalers অন্যান্য বিনিয়োগের চেয়ে উচ্চ হার থেকে izolated। আমি মনে করি স্পষ্ট যে একটি কোম্পানিরা যা খুব বেশি cash জেনারেট করে, অন্য বিনিয়োগের চেয়ে উচ্চ借ন কস্ট吸收 করতে সক্ষম হবে। حالیা hyperscalers টন নতুন debt জारी করছে, তবুও তারা অন্যান্য কোম্পানিরা相對ে খুব বেশি cash ফেলছে। সে বলা গেলা, আমি মনে করি এখে জোর দিতে চাই যে hypscalers এর সংগ্রহিত借ন ইচ্ছা নিজে rate-insensitive (এখন পর্যন্ত)। Satori Insightsে Matt King অনুযায়ী: “সমস্যা কম বর্তমান借নের পরিমাণ থেকে বেশি ইচ্ছা।”AI race를 existential/winner-takes-all terms (“Whoever has the best model, wins”) basicallyে কোনো upward limit নেই এই কোম্পানিগুলির respective AI buildouts জন্য hypothetically needed পैसेের পরিমাণ। একটি higher cost of capital these কোম্পানিগুলিকে তাদের respective financing mixে আরও রচিতা হওয়ার জন্য বাধ্য করতে পারে, কিন্তু এটি overall strategically imperative পরিবর্তন করবে না। এখানেই दिलचপূর্ণ বিষয় হলো — পिछले সপ্তাহে Joe লেখা গেলে ফিরে আসলে — একে অনেক democratically-elected governmentsের জন্যও সত্য হতে পারে। sovereign বন্ডসে yields বেড়ছে, কিন্তু বিশ্বে কেবল কিছু few সরকারই আছে যারা তাদের respective लोकপারুলারিটি গंभीর fiscal austerity এর নামে sacrifice করার জন্য willing। governmental agenda এর इतना much এখনও existential termsে (“আমাদের sekarang capabilityে on expenditure করতে হবে, যাতে পরে জীবন বাঁচতে”) একই dynamic at play। এটogether পুত করলে আমরা পাবো governments এবং hyperscalers থেকে yield-insensitive issuance এর অনেক, যারা জীবন বাঁচতে জন্য借ন করতে cảmসস করছে, price এর প্রতি sensitive একটি buyer-base এ টकरাব। আমরা জানি hedge funds US Treasuries এর buyer basic এর একটি বড় অংশ বান গেছে, উদাহরণে। “সমস্যা কম appetiteের অভাব থেকে বেশি central banks এবং liability matchers की ओर investors की ओर shift away, যারা কি কি কেনা real choice রাখে,” King কহে। বর্তমান bond environment কে একটি broad দৃষ্টিতে দেখা যেতে পারে issuers who feel them have no choice but to borrow running headfirst into buyers who feel they have a rapidly-expanding array of investment options। বন্ধের কথা বললে, কি এটি আজকুঁত奇怪 যে bonds récemment আরও “stock-like” হয়েছে? এটি এক প্রশ্ন যা really অনেক market discourse-এর কেন্দ্রে বসে এবং কিছু অন্যান্য প্রশ্ন জেনেrator: কি হলে investors government debt দিয়ে stocks hedge করতে পারবেন না? এবং কি বর্তমান bond selloff global বোঝায় যদি bonds_now “riskier”? আজের অতিথি, Carolin Pflueger, University of Chicago-এর একজন সহকারী professor এবং Chicago Fed-এর একজন居住 विद্বান, আমাদেরকে বুঝায় Fed’s ‘reaction function’ এবং institution’s credibility might play একটি rolęে bonds ‘more bond-like’ আবার তৈরি করতে। দেখুন: Bloomberg / You Tube শুনুন: Apple / Spotify Odd Lots का आनंद নিচে? এই newsletters পরিদর্শন করুন: আপনার पास other subscriber-only newsletters तक বিশেষ পৌঁছা আছে। সবকিছু newsletters aquí explore করুন তোমার Bloomberg subscription এর সবচেয়ে বড় পাওয়া পেতে।

The Existential Imperative to Borrow Joe Weisenthal and Tracy Alloway Mehr ertragsneutrale Aufnahme. Hallo und willkommen im Newsletter, einer Tüte täglicher Inhalte aus der Odd Lots Universe. Manchmal sind es wir, Joe Weisenthal und Tracy Alloway, die Ihnen unsere Gedanken zu den jüngsten Entwicklungen auf den Märkten, in der Finanzen und der Wirtschaft bringen.

Und manchmal sind es Beiträge aus unserem Netzwerk von Experten und Quellen. Was auch immer es ist, wir versprechen, dass es immer interessant sein wird. Wenn Ihnen das Chatten mit uns gefällt, schauen Sie im Odd Lots Discord vorbei, wo Sie 24/7 mit uns und anderen Zuhörern hangeln können.

Letzte Woche haben wir eine Folge mit Luke Kawa veröffentlicht, die darüber spricht, was derzeit auf den Märkten passiert. Während unseres Gesprächs habe ich beiseite gegangen und darüber gesprochen, wie Big Tech Unternehmen und hyperscalers von höheren Zinsen isoliert sind als andere Unternehmen. Es scheint mir offensichtlich, dass ein Unternehmen, das viel Cash generiert, in der Lage ist, höhere Kreditkosten besser zu absorbieren als andere Unternehmen.

Obwohl hyperscalers tatsächlich Tonnen neuen Schulden ausgeben, werfen sie immer noch genug Cash im Vergleich zu anderen Unternehmen ab. Darüber hinaus denke ich auch, dass der Schlüsselpunkt, den man betonen sollte, ist, dass die kollektive Impulse der hyperscalers zu leihen selbst ertragsneutral (bisher) ist. Wie Matt King von Satori Insights sagt: “Das Problem ist weniger das Volumen des aktuellen Leihens als das Verlangen.”Mit dem AI-Rennen, das in existenziellem/winner-takes-all-Begriffen (“Wer das beste Modell hat, gewinnt”) basically kein upper Limit auf die hypothetische Menge an Geld hat, die diese Unternehmen benötigen, um ihre respective AI buildouts zu finanzieren.

Ein höherer Kapitalkosten kann diese Unternehmen dazu bringen, kreativer in ihrer Finanzierungsmischung zu werden, ändert aber nicht den strategischen Imperativ insgesamt. Was hier interessant ist — zurückgehend auf etwas, das Joe letzte Woche geschrieben hat — ist, dass dasselbe wohl auch für viele demokratisch gewählte Regierungen gilt. Die Renditen bei Staatsanleihen steigen, aber es gibt wenige Regierungen weltweit, die bereit wären, ihre respective Beliebtheit im Namen ernsthafter Finanzkonsolidierung aufzugeben.

Da so viel der politischen Agenda nun auch in existenziellem Begriffen (“Wir müssen jetzt Kapazität schaffen, um später zu überleben”) ähnlich dynamisch ist. Alles zusammen genommen ergibt das viel mehr ertragsneutrale Aufnahme sowohl von Regierungen als auch von hyperscalers, die das Gefühl haben, sie müssen weiter leihen, um zu überleben, und dies stößt auf eine Käuferbasis für Schuldverschreibungen, die tatsächlich preissensibler ist. Wir wissen, dass Hedgefonds mittlerweile einen größeren Teil der Käuferbasis für US-Treasuries ausmachen. “Das Problem ist weniger ein Mangel an Appetit als ein Wechsel weg von Zentralbanken und Liability-Matchern hin zu Investoren, die eine echte Wahl haben, was sie kaufen”, sagt King.

Eine breite Möglichkeit, die aktuelle Anleihenlandschaft zu betrachten, ist als Ort, an dem Emittenten, die das Gefühl haben, sie müssten leihen, kopfüber in eine Käuferbasis laufen, die das Gefühl hat, sie hätten ein schnell erweiterndes Angebot an Investitionsoptionen. Über Anleihen gesprochen, ist es nicht seltsam, dass Anleihen kürzlich mehr “aktien-like” geworden sind? Es ist eine Frage, die wirklich im Zentrum vieler Marktdiskussionen steht und einige weitere Fragen generiert: Was passiert, wenn Investoren Aktien nun nicht mehr mit Regierungsverschuldung absichern können? Und was erklärt den globalen Verkauf von Anleihen, wenn Anleihen jetzt “risikoreicher” sind? Heute Gast, Carolin Pflueger, assoziierte Professorin an der University of Chicago und resident Scholar am Chicago Fed, spricht mit uns darüber, wie die ‘Reaktionsfunktion’ der Fed und die Glaubwürdigkeit der Institution eine Rolle spielen könnten, Anleihen “more bond-like” wieder zu machen. Schauen Sie: Bloomberg / You Tube Hören: Apple / Spotify Odd Lots genießen? Schauen Sie sich diese Newsletter an: Sie haben exklusiven Zugang zu anderen subscriber-only Newslettern. Erkunden Sie alle Newsletter hier, um das Maximum aus Ihrer Bloomberg-Abonnement herauszuholen.

The Existential Imperative to Borrow Joe Weisenthal and Tracy Alloway Más emisión insensible al rendimiento. Hola y bienvenido a la newsletter, una bolsa de contenido diario del universo Odd Lots. A veces somos nosotros, Joe Weisenthal y Tracy Alloway, los que le traemos nuestros pensamientos sobre los últimos desarrollos en mercados, finanzas y economía.

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La semana pasada, lanzamos un episodio con Luke Kawa hablando sobre lo que está sucediendo en los mercados en este momento. Durante nuestra conversación, hice un aparte sobre cómo las empresas de Big Tech y los hyperscalers están aislados de tasas más altas que otros negocios. Esto provocó algunas reacciones en línea.

Me parece obvio que una empresa que genera mucho efectivo será mejor para absorber costos de endeudamiento más altos en comparación con otros negocios. Aunque los hyperscalers sí están emitiendo toneladas de nueva deuda, siguen arrojando mucho efectivo en comparación con otras empresas. Dicho esto, también creo que la clave para enfatizar aquí es que el impulso colectivo de los hyperscalers a tomar prestado es en sí mismo insensible a la tasa (hasta ahora).

Como dice Matt King de Satori Insights: “El problema es menos el volumen de endeudamiento actual que el deseo.”Con la carrera de IA enmarcada en términos existenciales/ganador-toma-todo (“Quién tenga el mejor modelo, gana”) básicamente no hay límite superior en la cantidad hipotética de dinero que estas empresas necesitan para financiar sus respectivos AI buildouts. Un costo más alto de capital puede obligar a estas empresas a ser más creativas en su mezcla de financiamiento, pero no cambia el imperativo estratégico en general. Lo interesante aquí — volviendo a algo que Joe escribió la semana pasada — es que lo mismo probablemente sea cierto de muchos gobiernos electos democráticamente.

Los rendimientos están subiendo en los bonos soberanos, pero pocos gobiernos en el mundo parecen dispuestos a sacrificar su popularidad en nombre de una austeridad fiscal seria. Con tanta de la agenda política ahora también envuelta en términos existenciales (“Debemos gastar ahora en capacidad, para sobrevivir después”) hay una dinámica similar. Ponlo todo junto y obtendrás mucho más emisión insensible al rendimiento por parte de gobiernos y hyperscalers, que sienten que deben seguir tomando prestado para sobrevivir, chocando contra una base de compradores de deuda que en realidad es más sensible al precio.

Sabemos que los fondos de cobertura se han convertido en una parte más grande de la base de compradores de los Tesoros estadounidenses, por ejemplo. “El problema es menos falta de apetito que un cambio alejado de los bancos centrales y los que emparejan liability hacia inversores con una elección real de qué comprar”, dice King. Una forma amplia de mirar el entorno actual de bonos es como un lugar donde los emisores que sienten que no tienen otra opción que tomar prestado se lanzan de cabeza a compradores que sienten que tienen una expansión rápidamente array de opciones de inversión. Hablando de bonos, ¿no es extraño que los bonos se hayan vuelto más “como acciones” últimamente? Es una pregunta que realmente está en el centro de mucho discurso de mercado, y genera algunas preguntas más: ¿Qué pasa si los inversores ya no pueden cubrir acciones con deuda gubernamental? Y qué explica la venta global de bonos si los bonos ahora son “más arriesgados”? Hoy’s guest, Carolin Pflueger, asociado profesor en la Universidad de Chicago y residente en el Chicago Fed, nos habla sobre cómo la ‘función de reacción’ de la Fed y la credibilidad de la institución podrían desempeñar un papel en hacer que los bonos ‘más como bonos’ nuevamente.

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The Existential Imperative to Borrow Joe Weisenthal and Tracy Alloway Plus d'émission insensible au rendement. Bonjour et bienvenue dans la newsletter, un sac de contenu quotidien de l'univers Odd Lots. Parfois c'est nous, Joe Weisenthal et Tracy Alloway, qui vous apportons nos pensées sur les derniers développements des marchés, de la finance et de l'économie.

Et parfois ce sont des contributions de notre réseau d'invités experts et de sources. Quoi que ce soit, nous promettons toujours quelque chose d'intéressant. Si vous aimez discuter avec nous, consultez le Discord Odd Lots, où vous pouvez vous détendre et discuter avec nous et avec d'autres auditeurs 24/7.

La semaine dernière, nous avons sorti un épisode avec Luke Kawa parlant de ce qui se passe sur les marchés actuellement. Pendant notre conversation, j'ai fait un aparté sur la façon dont les entreprises de Big Tech et les hyperscalers sont isolés des taux plus élevés que les autres entreprises. Cela a provoqué quelques réactions en ligne.

Il me semble évident qu'une entreprise qui génère beaucoup de cash sera mieux à même d'absorber des coûts d'emprunt plus élevés par rapport aux autres entreprises. Bien que les hyperscalers émettent effectivement tonnes de nouvelle dette, ils jettent encore beaucoup de cash par rapport aux autres entreprises. Dites-moi, je pense aussi que la chose clé à souligner ici est que l'impulsion collective des hyperscalers à emprunter est elle-même insensible aux taux (jusqu'à présent).

Comme le dit Matt King de Satori Insights : « Le problème est moins le volume d'emprunt actuel que le désir. »Avec la course de l'IA encadrée en termes existentiel/ gagnant-tout (« Celui qui a le meilleur modèle, gagne ») il n'y a basically pas de limite supérieure hypothétique sur la quantité d'argent que ces entreprises doivent besoin de financer leurs respective AI buildouts. Un coût plus élevé du capital peut forcer ces entreprises à être plus créatives dans leur mélange de financement, mais cela ne change pas l'impératif stratégique global. Ce qui est intéressant ici — en revenant à quelque chose que Joe a écrit la semaine dernière — c'est que le même est vraisemblablement vrai de nombreux gouvernements élus démocratiquement.

Les rendements montent sur les obligations souveraines, mais il y a peu de gouvernements dans le monde qui semblent disposés à sacrifier leur popularité au nom d'une austérité fiscale sérieuse. Avec autant de l'agenda politique maintenant également enveloppé en termes existentiel (« Nous devons dépenser maintenant en capacité, pour survivre plus tard ») il y a une dynamique similaire. Mettez tout ensemble et vous obtenez beaucoup plus d'émission insensible au rendement de la part des gouvernements et des hyperscalers, qui sentent qu'ils doivent continuer à emprunter pour survivre, s'écrasant dans une base d'acheteurs de dette qui est en réalité plus sensible au prix.

Nous savons que les fonds spéculatifs sont devenus une partie plus grande de la base d'acheteurs des Trésors américains, par exemple. « Le problème est moins un manque d'appétit qu'un changement loin des banques centrales et des matchers de liability vers des investisseurs avec un vrai choix de quoi acheter », dit King. Une large façon de regarder l'environnement actuel des obligations est comme un endroit où les émetteurs qui sentent qu'ils n'ont pas le choix mais d'emprunter courent tête baissée dans des acheteurs qui sentent qu'ils ont un array rapidement-expanding d'options d'investissement. En parlant d'obligations, n'est-ce pas étrange que les obligations soient devenues plus « actions » récemment ? C'est une question qui vraiment au centre de beaucoup de discourse de marché, et elle génère quelques autres questions : Que se passe-t-il si les investisseurs peuvent plus couvrir des actions avec de la dette gouvernementale ? Et qu'est-ce qui explique la vente mondiale d'obligations si les obligations sont maintenant « plus risquées » ? Aujourd'hui invité, Carolin Pflueger, professeur associé à l'Université de Chicago et chercheur résident à la Chicago Fed, nous parle de la façon dont la ‘fonction de réaction’ de la Fed et la crédibilité de l'institution pourraient jouer un rôle dans la rendre les obligations 'plus comme obligations' à nouveau.

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The Existential Imperative to Borrow Joe Weisenthal and Tracy Alloway अधिक प्रदर्शन-अनुकूल जारीकरण। हैलो और स्वागत है न्यूज़लेटर, एक दैनिक सामग्री थैला Odd Lots के ब्रह्मांड से। कभी-कभी हम होते हैं, जो वीसेंटल और ट्रेसी Alloway, आपको बाजारों, वित्त और अर्थव्यवस्था में सबसे recent विकास के बारे में हमारे विचार ला रहे हैं। और कभी-कभी यह हमारे विशेषज्ञ अतिथि और स्रोतों के नेटवर्क से योगदान है। जो भी हो, हम हमेशा इसे दिलचस्प prometise करते हैं। अगर आप हमसे चैट करना पसंद करते हैं, तो Odd Lots Discord की जांच करें, जहां आप 24/7 हमें और अन्य श्रोताओं के साथ बातचीत कर सकते हैं।पिछले सप्ताह, हमने Luke Kawa के साथ एक एपिसोड जारी किया, जिसमें बाजारों में क्या हो रहा है इस पर चर्चा की गई। हमारे बातचीत के दौरान, मुझे बाजारों के बारे में एक टिप्पणी करने के लिए प्रेरित किया गया कि Big Tech कंपनियां और hyperscalers अन्य व्यवसायों की तुलना में उच्च दरों से izolated हैं। मुझे लगता है कि स्पष्ट है कि एक कंपनी जो भारी मात्रा में नकदी उत्पन्न करती है, उसे उच्च उधार लेने के लागत को अवशोषित करने में अन्य व्यवसायों की तुलना में बेहतर सक्षम होगा। जबकि hyperscalers वास्तव में नई ऋण जारी कर रहे हैं टन, फिर भी वे अन्य कंपनियों की तुलना में काफी नकदी फेंक रहे हैं। कहा गया है, मुझे यह भी लगता है कि यहाँ जोर देने की मुख्य बात यह है कि hypscalers का संग्रहात्मक उधार लेने की इच्छा स्वयं दर-अनुकूल है (अभी तक)। Satori Insights में Matt King के अनुसार: “समस्या कम वर्तमान उधार लेने की मात्रा से है और अधिक इच्छा।”आईएआई दौड़ को अस्तित्वगत/विजेता-ले-ले-terms में रखा गया है (“सबसे अच्छा मॉडल whoever wins”) basically में कोई upward limit नहीं है इन कंपनियों को अपने-अपने AI buildouts के लिए hypothetically needed पैसे की राशि। एक उच्च पूंजी लागत इन कंपनियों को अपने वित्तीय मिश्रण में अधिक रचनात्मक होने के लिए मजबूर कर सकती है, लेकिन यह समग्र strategically imperative को नहीं बदलता। यहाँ दिलचस्प बात यह है — पिछले सप्ताह जोe लिखा गया है वापस आने के लिए — वही शायद कई democratically-elected governments के लिए भी सत्य है। sovereign बॉन्ड पर यील्ड बढ़ रही है, लेकिन दुनिया भर में कम ही सरकारें हैं जो अपनी क्रमशिय लोकप्रियता को गंभीर fiscal austerity के नाम पर त्यागने को तैयार हैं। राजनीतिक एजेंडा के इतना much अब भी existentially terms में लिपटा हुआ है (“अब क्षमता पर खर्च करना होगा, ताकि बाद में जीवित रहना”) एक समान dynamic at play है। इसे एक साथ रखने से क्या मिलता है दोनों सरकारों और hyperscalers से yield-insensitive issuance का एक lot, जो जीवित रहने के लिए कर्ज लेने के लिए महसूस करते हैं, price के प्रति अधिक sensitive एक buyer-base में टकराव। हम जानते हैं कि hedge funds US Treasuries के खरीदार आधार का एक बड़ा हिस्सा बन गए हैं, उदाहरण के लिए। “समस्या कम इच्छा की कमी से है जितना central banks और liability matchers की ओर निवेशकों की ओर shift away की ओर, जो वास्तव में क्या खरीदने का विकल्प रखते हैं,” कहती है King। वर्तमान bond environment को एक broad नज़र से देखने का एक तरीका यह है कि issuers जो feel उन्हें borrow करने के अलावा कोई विकल्प नहीं है, buyers के साथ headfirst में भाग रहे हैं जो feel उनके पास rapidly-expanding array of investment options है। बांड के बारे में बोलते हुए, क्या यह अजीब नहीं है कि बांड हाल ही में अधिक “स्टॉक जैसा” हो गए हैं? यह एक प्रश्न है जो really बहुत सारे market discourse के केंद्र में बैठता है, और यह कुछ अन्य प्रश्न उत्पन्न करता है: अगर निवेशक अब सरकारी ऋण के साथ स्टॉक को हेज नहीं कर सकते? और अगर बांड अब “जोखिम भरे” हैं, तो global bond selloff क्या समझाता है? आज के अतिथि, Carolin Pflueger, University of Chicago के एक सहायक professor और Chicago Fed के एक निवासी विद्वान, हमें बताते हैं कि Fed की ‘reaction function’ और संस्था की विश्वसनीयता might play एक भूमिका में बांड को ‘more bond-like’ फिर से बनाना। देखें: Bloomberg / You Tube सुनें: Apple / Spotify Odd Lots का आनंद ले रहे हैं? इन newsletters की जांच करें: आपके पास अन्य subscriber-only newsletters तक विशेष पहुंच है। सभी newsletters यहाँ explore करें ताकि अपने Bloomberg subscription का सबसे अधिक प्राप्त करें।

The Existential Imperative to Borrow Joe Weisenthal and Tracy Alloway Lebih pinjaman insensitive terhadap rendemen. Hello and welcome to the newsletter, a grab bag of daily content from the Odd Lots universe. Sometimes it’s us, Joe Weisenthal and Tracy Alloway, bringing you our thoughts on the most recent developments in markets, finance and the economy.

And sometimes it’s contributions from our network of expert guests and sources. Whatever it is, we promise it will always be interesting. If you like chatting with us, check out the Odd Lots Discord, where you can hang out and talk with us and with other listeners 24/7.

Last week, we released an episode with Luke Kawa talking about what’s going on in markets right now. During our conversation, I made an aside about how Big Tech companies and hyperscalers are insulated from higher rates than other businesses. This prompted some pushback online.

It seems obvious to me that a company that generates loads of cash is going to be better able to absorb higher borrowing costs compared to other businesses. While hyperscalers are indeed issuing tons of new debt, they are still throwing off plenty of cash relative to other companies. That said, I also think the key thing to emphasize here is that the collective impulse of hypscalers to borrow is itself rate-insensitive (so far).

As Matt King over at Satori Insights puts it: “The issue is less the volume of current borrowing than the desire.”With the AI race couched in existential/winner-takes-all terms (“Whoever has the best model, wins”) there’s basically no upward limit on the hypothetical amount of money these companies need to fund their respective AI buildouts. A higher cost of capital may force these companies to get more creative in their financing mix, but it doesn’t change the strategic imperative overall. What’s interesting here — getting back to something Joe wrote last week — is that the same is arguably true of many democratically-elected governments.

Yields are going up on sovereign bonds, but there are few governments anywhere in the world that look willing to sacrifice their respective popularity in the name of serious fiscal austerity. With so much of the political agenda now also wrapped in existential terms (“We must spend now on capacity, in order to survive later”) there’s a similar dynamic at play. Put it altogether and what you get is a lot more yield-insensitive issuance from both governments and hyperscalers, who feel they must keep borrowing to survive, crashing into a buyer-base for debt that is actually more sensitive to price.

We know that hedge funds have become a bigger part of the buyer base for US Treasuries, for instance. “The problem is less a lack of appetite than a shift away from central banks and liability matchers towards investors with a real choice of what to buy,” says King. One broad way of looking at the current bond environment is as a place where issuers who feel they have no choice but to borrow are running headfirst into buyers who feel they have a rapidly-expanding array of investment options. Speaking of bonds, isn’t it weird that bonds have become more “stock-like” lately? It’s a question the really sits at the center of lots of market discourse, and it generates a few other questions: What happens if investors can no longer hedge stocks with government debt? And what explains the global selloff in bonds if bonds are now “riskier”? Today’s guest, Carolin Pflueger, associate professor at the University of Chicago and a resident scholar at the Chicago Fed, talks to us about how the Fed’s “reaction function” and the institution’s credibility might play a role in making bonds more “bond-like” again.

Watch: Bloomberg / You Tube Listen: Apple / Spotify Enjoying Odd Lots? Check out these newsletters: You have exclusive access to other subscriber-only newsletters. Explore all newsletters here to get most out of your Bloomberg subscription.

The Existential Imperative to Borrow Joe Weisenthal and Tracy Alloway よりインセンティブのない借入。Hello and welcome to the newsletter, a grab bag of daily content from the Odd Lots universe. Sometimes it’s us, Joe Weisenthal and Tracy Alloway, bringing you our thoughts on the most recent developments in markets, finance and the economy. And sometimes it’s contributions from our network of expert guests and sources.

Whatever it is, we promise it will always be interesting. If you like chatting with us, check out the Odd Lots Discord, where you can hang out and talk with us and with other listeners 24/7. Last week, we released an episode with Luke Kawa talking about what’s going on in markets right now.

During our conversation, I made an aside about how Big Tech companies and hyperscalers are insulated from higher rates than other businesses. This prompted some pushback online. It seems obvious to me that a company that generates loads of cash is going to be better able to absorb higher borrowing costs compared to other businesses.

While hyperscalers are indeed issuing tons of new debt, they are still throwing off plenty of cash relative to other companies. That said, I also think the key thing to emphasize here is that the collective impulse of hypscalers to borrow is itself rate-insensitive (so far). As Matt King over at Satori Insights puts it: “The issue is less the volume of current borrowing than the desire.”With the AI race couched in existential/winner-takes-all terms (“Whoever has the best model, wins”) there’s basically no upward limit on the hypothetical amount of money these companies need to fund their respective AI buildouts.

A higher cost of capital may force these companies to get more creative in their financing mix, but it doesn’t change the strategic imperative overall. What’s interesting here — getting back to something Joe wrote last week — is that the same is arguably true of many democratically-elected governments. Yields are going up on sovereign bonds, but there are few governments anywhere in the world that look willing to sacrifice their respective popularity in the name of serious fiscal austerity.

With so much of the political agenda now also wrapped in existential terms (“We must spend now on capacity, in order to survive later”) there’s a similar dynamic at play. Put it altogether and what you get is a lot more yield-insensitive issuance from both governments and hyperscalers, who feel they must keep borrowing to survive, crashing into a buyer-base for debt that is actually more sensitive to price. We know that hedge funds have become a bigger part of the buyer base for US Treasuries, for instance. “The problem is less a lack of appetite than a shift away from central banks and liability matchers towards investors with a real choice of what to buy,” says King.

One broad way of looking at the current bond environment is as a place where issuers who feel they have no choice but to borrow are running headfirst into buyers who feel they have a rapidly-expanding array of investment options. Speaking of bonds, isn’t it weird that bonds have become more “stock-like” lately? It’s a question the really sits at the center of lots of market discourse, and it generates a few other questions: What happens if investors can no longer hedge stocks with government debt? And what explains the global selloff in bonds if bonds are now “riskier”? Today’s guest, Carolin Pflueger, associate professor at the University of Chicago and a resident scholar at the Chicago Fed, talks to us about how the Fed’s “reaction function” and the institution’s credibility might play a role in making bonds more “bond-like” again. Watch: Bloomberg / You Tube Listen: Apple / Spotify Enjoying Odd Lots? Check out these newsletters: You have exclusive access to other subscriber-only newsletters.

Explore all newsletters here to get most out of your Bloomberg subscription.

The Existential Imperative to Borrow Joe Weisenthal and Tracy Alloway Mais emissão insensível ao rendimento. Olá e bem-vindo à newsletter, uma bolsa de conteúdo diário do universo Odd Lots. Às vezes é nós, Joe Weisenthal e Tracy Alloway, trazendo-lhe nossos pensamentos sobre os últimos desenvolvimentos em mercados, finanças e economia. E às vezes são contribuições da nossa rede de convidados especialistas e fontes.

Quer seja o que for, sempre prometemos que será interessante. Se você gosta de conversar conosco, confira o Discord Odd Lots, onde você pode ficar e conversar conosco e com outros ouvintes 24/7. Na semana passada, lançamos um episódio com Luke Kawa falando sobre o que está acontecendo nos mercados agora.

Durante nossa conversa, fiz um aparte sobre como empresas de Big Tech e hyperscalers estão isoladas de taxas mais altas do que outros negócios. Isso provocou algumas reações online. Me parece óbvio que uma empresa que gera muito cash vai ser melhor capaz de absorver custos de empréstimo mais altos em comparação com outros negócios.

Embora os hyperscalers estejam realmente emitindo toneladas de nova dívida, ainda estão jogando bastante cash em comparação com outras empresas. Dito isso, também acho que a coisa-chave a enfatizar aqui é que o impulso coletivo dos hyperscalers a pegar emprestado é ele mesmo insensível a taxas (até o momento). Como diz Matt King da Satori Insights: “O problema é menos o volume de empréstimo atual do que o desejo.”Com a corrida da IA enquadrada em termos existencial/winner-takes-all (“Quem tiver o melhor modelo, ganha”) basicamente não há limite superior hipotético na quantidade de dinheiro que essas empresas precisam para financiar seus respectivos AI buildouts.

Um custo mais alto de capital pode forçar essas empresas a serem mais criativas em sua mistura de financiamento, mas não muda o imperativo estratégico geral. O que é interessante aqui — voltando a algo que Joe escreveu na semana passada — é que o mesmo provavelmente é verdade de muitos governos eleitos democraticamente. As taxas de rendimento estão subindo nos títulos soberanos, mas poucos governos em qualquer lugar do mundo parecem dispostos a sacrificar sua popularidade em nome de uma austeridade fiscal séria.

Com tanta da agenda política agora também envolvida em termos existencial (“Gastar agora em capacidade, para sobreviver depois”) há uma dinâmica semelhante. Juntando tudo o que você tem muito mais emissão insensível ao rendimento tanto de governos quanto de hyperscalers, que sentem que precisam continuar pegando emprestado para sobreviver, chocando contra uma base de compradores de dívida que é realmente mais sensível ao preço. Sabemos que fundos de hedge se tornaram uma parte maior da base de compradores dos Tesouros americanos, por exemplo. “O problema é menos falta de apetite do que uma mudança afastada de bancos centrais e matchers de liability para investidores com uma escolha real do que comprar”, diz King.

Uma forma ampla de olhar o ambiente atual de títulos é como um lugar onde emissores que sentem que não têm outra opção senão pegar emprestado estão correndo de cabeça para compradores que sentem que têm um array rapidamente-expanding de opções de investimento. Falando em títulos, não é estranho que os títulos tenham se tornado mais “ação-like” lately? É uma pergunta que realmente fica no centro de muito discurso de mercado, e gera algumas perguntas adicionais: O que acontece se investidores não puderem mais proteger ações com dívida governamental? E o que explica a venda global de títulos se os títulos agora são “mais arriscados”? Hoje’s guest, Carolin Pflueger, associado professor na Universidade de Chicago e pesquisador residente no Chicago Fed, nos fala sobre como a ‘função de reação’ da Fed e a credibilidade da instituição podem desempenhar um papel em tornar os títulos ‘mais como títulos’ novamente. Assistir: Bloomberg / You Tube Ouvir: Apple / Spotify Curtindo Odd Lots? Confira estas newsletters: Você tem acesso exclusivo a outras newsletters apenas para assinantes.

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The Existential Imperative to Borrow Joe Weisenthal and Tracy Alloway Более безразличный до доходности issuance. Приветствуем вас в новостной рассылке, ежедневном мешке контента из вселенной Odd Lots. Иногда это мы, Joe Weisenthal и Tracy Alloway, принося вам наши мысли о последних событиях на рынках, финансах и экономике. Иногда это вклады от нашей сети экспертных гостей и источников. Что бы ни было, мы всегда обещаем, что это будет интересно. Если вам нравится с нами поговорить, проверьте Discord Odd Lots, где вы можете проводить время и общаться с нами и другими слушателями 24/7.На прошлой неделе мы выпустили эпизод с Luke Kawa, обсуждающим, что происходит на рынках прямо сейчас. Во время нашего разговора я отвлекся и сказал, как компании Big Tech и hyperscalers изолированы от более высоких ставок, чем другие бизнес. Кажется очевидно, что компания, генерирующая много денег, будет лучше способна поглощать более высокие стоимости заимствования, по сравнению с другими бизнесами. Хотя hyperscalers действительно выпускают тонны новой задолженности, они все равно выбрасывают plenty cash по сравнению с другими компаниями. Тем не менее, я также думаю, что ключевой момент, который стоит подчеркнуть, — это то, что коллективный импульс hypscalers заимствовать сам по себе безразличен к ставкам (пока что). Как говорит Matt King из Satori Insights: «Проблема меньше в объеме текущего заимствования, чем в желании».С гонкой ИИ, заключенной в экзистенциальных/победитель-берет-все терминах («Кто имеет лучшую модель, выигрывает») basically нет верхней границы на гипотетическую сумму денег, которую эти компании нужны для финансирования своих respective AI buildouts. Более высокая стоимость капитала может заставить эти компании быть более креативными в своей финансовой смеси, но это не меняет стратегический импульс в целом. То, что здесь интересно — возвращаясь к чему-то, что Joe написал на прошлой неделе — так же arguable true многих демократически избранных правительств. Доходности на государственных облигациях растут, но немногих правительств в мире似乎 готовы отступить от своей популярности в Namen серьезной фISCальной аскетичности. С так много политической агитации теперь также заключенной в экзистенциальных терминах («Мы должны тратить сейчас на вместимость, чтобы выжить позже») есть аналогичная динамика. Если собрать всё вместе, то получается намного больше безразличного до доходности issuance от правительств и hyperscalers, которые чувствуют, что должны продолжать заимствовать для выживания, сталкиваясь с покупательской базой долга, которая на самом деле более чувствительна к цене. Мы знаем, что хедж-фонды стали большей частью покупательской базы США Treasuries, например. «Проблема меньше нежелания нехватки, чем сдвиг away от central banks и liability matchers towards инвесторов с реальным выбором, что купить», говорит King. Один широкий способ посмотреть на текущую облигационную среду — это как место, где issuers, которые чувствуют, что не имеют выбора, но заимствовать, бросаются в голову покупателям, которые чувствуют, что имеют rapidly-expanding array of investment options. Говоря о облигациях, не странно ли, что облигации стали более «акция-like» lately? Это вопрос, который really стоит в центре множества рыночных дискуссий, и он генерирует несколько других вопросов: Что случится, если инвесторы больше могут хеджировать акции с государственным долгом? И что объясняет глобальную продажу облигаций, если облигации теперь «рискованнее»? Сегодня гость, Carolin Pflueger, доцент Университета Чикаго и резидентный ученый Чикагского ФРД, говорит с нами о том, как ‘функция реакции’ ФРД и достоверность института могут сыграть роль в том, чтобы сделать облигации ‘more bond-like’ снова. Смотрите: Bloomberg / You Tube Слушайте: Apple / Spotify Наслаждаетесь Odd Lots? Проверьте эти новости: У вас есть эксклюзивный доступ к другим новостным рассылкам только для подписчиков. Исследуйте все новости здесь, чтобы получить максимальную пользу от вашей подписки Bloomberg.

The Existential Imperative to Borrow Joe Weisenthal and Tracy Alloway 更多抗敏感发行。Hello and welcome to the newsletter, a grab bag of daily content from the Odd Lots universe. Sometimes it’s us, Joe Weisenthal and Tracy Alloway, bringing you our thoughts on the most recent developments in markets, finance and the economy. And sometimes it’s contributions from our network of expert guests and sources.

Whatever it is, we promise it will always be interesting. If you like chatting with us, check out the Odd Lots Discord, where you can hang out and talk with us and with other listeners 24/7. Last week, we released an episode with Luke Kawa talking about what’s going on in markets right now.

During our conversation, I made an aside about how Big Tech companies and hyperscalers are insulated from higher rates than other businesses. This prompted some pushback online. It seems obvious to me that a company that generates loads of cash is going to be better able to absorb higher borrowing costs compared to other businesses.

While hyperscalers are indeed issuing tons of new debt, they are still throwing off plenty of cash relative to other companies. That said, I also think the key thing to emphasize here is that the collective impulse of hypscalers to borrow is itself rate-insensitive (so far). As Matt King over at Satori Insights puts it: “The issue is less the volume of current borrowing than the desire.”With the AI race couched in existential/winner-takes-all terms (“Whoever has the best model, wins”) there’s basically no upward limit on the hypothetical amount of money these companies need to fund their respective AI buildouts.

A higher cost of capital may force these companies to get more creative in their financing mix, but it doesn’t change the strategic imperative overall. What’s interesting here — getting back to something Joe wrote last week — is that the same is arguably true of many democratically-elected governments. Yields are going up on sovereign bonds, but there are few governments anywhere in the world that look willing to sacrifice their respective popularity in the name of serious fiscal austerity.

With so much of the political agenda now also wrapped in existential terms (“We must spend now on capacity, in order to survive later”) there’s a similar dynamic at play. Put it altogether and what you get is a lot more yield-insensitive issuance from both governments and hyperscalers, who feel they must keep borrowing to survive, crashing into a buyer-base for debt that is actually more sensitive to price. We know that hedge funds have become a bigger part of the buyer base for US Treasuries, for instance. “The problem is less a lack of appetite than a shift away from central banks and liability matchers towards investors with a real choice of what to buy,” says King.

One broad way of looking at the current bond environment is as a place where issuers who feel they have no choice but to borrow are running headfirst into buyers who feel they have a rapidly-expanding array of investment options. Speaking of bonds, isn’t it weird that bonds have become more “stock-like” lately? It’s a question the really sits at the center of lots of market discourse, and it generates a few other questions: What happens if investors can no longer hedge stocks with government debt? And what explains the global selloff in bonds if bonds are now “riskier”? Today’s guest, Carolin Pflueger, associate professor at the University of Chicago and a resident scholar at the Chicago Fed, talks to us about how the Fed’s “reaction function” and the institution’s credibility might play a role in making bonds more “bond-like” again. Watch: Bloomberg / You Tube Listen: Apple / Spotify Enjoying Odd Lots? Check out these newsletters: You have exclusive access to other subscriber-only newsletters.

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