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Waterfall’s Jack Ross Talks Structured Markets: Credit Crunch

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How to Avoid Cliff Bonds in a Recession

We do three different scenarios of analyses for that bond or that loan. We look at the base case, how will it perform in a recession? How high will the faults go? What does that mean in terms of our attachment point in the structure? And so what we do is we avoid what we call cliff bonds. That's not what we look to buy here at waterfall. So and real quick, getting back to kind of the Fed and their comments specifically around how we could see two more hikes through the end of the year and then rates may stay a little bit higher for longer.

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