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- he systemic risk question you need to ask yourself today is the same question you needed to ask in 2008:
What is the micro-level truth of the potential real-world shock (home price appreciation then, virus biology today), and does that micro-level truth threaten the common knowledge surrounding a levered business model and securitized asset class of enormous size (mortgage-backed securities then, global trade finance and collateralized loan obligations and similar debt securitizations today)?
I know that last sentence was a mouthful. But it’s worth parsing.