Rate accompli: Are rising interest rates bad for all assets?
Many Happy Returns
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What Is Quality?
There's something called distance to default. If you haven't got enough equity capital then essentially you've got a thinner margin and if that gets wiped out you're gone. Maybe companies which might do better here are ones where they have a large amount of cash on their balance sheet because one you're getting paid more for that cash your interest payments are higher. And also you're kind of a more quality company you can cover your debt more easily. So maybe they're the companies which will do better. But during a flight to shite it is what we saw after the pandemic that's when quality underperforms.
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