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Comment by dmckeon | Hacker News Reader

> lower quality leases are being thrown into securitization pools

Shocked, shocked, do you hear me!

Not to snark at this poster, but in general, if we learn anything from experience in markets, we learn:

People want higher returns without higher risks, and other people can profit from convincing buyers that the returns are higher, or the risks are lower.

Also, money is more nimble than legislation. While Congress is trying to outlaw the most recently exposed scam or malfeasance, people are inventing the next several workarounds to existing or upcoming law.

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> People want higher returns without higher risks, and other people can profit from convincing buyers that the returns are higher, or the risks are lower.

That does happen, but what may be even more common (and more important is a slightly different form:

People want high returns, and are willing to accept risks, but are required by law to invest in safe securities, and are happy to pay high fees for people who can find a way around this.

A huge driver of this isn't scams or outright fraud, but "regulatory arbitrage". Not saying it's fine, but if your mental model is "how can we protect unsophisticated mom and pop investors from these predators selling exotic asset backed securities", well, they're not the ones buying them. The bigger question is, how can we (or should we?) stop pension funds from knowingly seeking higher risk/higher return investments as part of their ongoing effort to try and reduce their massive unfunded liabilities.

Heck, I think they mostly write the laws for Congress...

> People want higher returns without higher risks

Not only this, but Better, Cheaper, Faster.

I'm in Healthcare and it doesn't work like this.

Reimbursement for work is on a slow decline, and has been for a while (in radiology at least). Hardware vendors and conference talks are often centred around a theme of ‘doing more with less’. This link is an example and discusses revenue declining but the development of new tools might help to get more value out of imaging. https://www.alliancehealthcareservices-us.com/12-imaging-mar...

The average multiple on a healthcare services business is 10x and HCIT assets are trading on revenue multiples. It works exactly like this everywhere. Livongo, Health Catalyst and Phreesia just went public at multiples that didn’t exist 5 years ago

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