Acorn - Short GS
Price discovery is a b***h!
Originally published November 14th 2022
As promised in Monday’s note, we are having a swing at the Vampire Squid. The recent failure of FTX has highlighted risk management failings in the private assets space and the 🐿️ has a hunch that this illiquid and opaque world has the potential to become the ‘patient zero’ of the next financial crisis. This is not a niche problem. Driven by free money and the attractions of blended (aka ‘laundered’) volatility (private valuations only move if you measure them, duh!), the allocator community has ensured that private assets are an increasing feature of many public and private sector savings and retirement vehicles.