Emre Switzer

[Emre Switzer @EmreSwitzer]

@DebasementCap @kkmaway No. Its not.

Its the same as Oct. '22, June '24 - Long dated debt needs liquidity.

This round driven by AI capex soaking up all long debt demand IMO. Nobody wants US10Y @ 4.6% when you can get data centers at 8%.

Its not YCC. Its not QE.

[Emre Switzer @EmreSwitzer]

@leshka_eth Yen is a rounding error here.

Long term US debt is incredibly unattractive at current rates. Private debt is much more appealing. That's the whole story.

Everyone is taking data center debt at 7-9%, whereas the US10Y is at 4.6%.

Thats the whole story.

[Emre Switzer @EmreSwitzer]

@airbnfee @JSchwarz9 @bchesky Crazy how many people are passionate about the product & company, but are frustrated with how poor mgmt is.

[Emre Switzer @EmreSwitzer]

@general_pachen @JSchwarz9 Horribly unfocused leadership. Been selling covered calls against since 2022.

They rolled out 'verified wifi speed' years ago, but never allowed guests to filter based on it. Would have been nice with the remote work boom - management is clueless how bad their product is now.

[Emre Switzer @EmreSwitzer]

@h1vae @bchesky @JSchwarz9 They've ruined the service with their CS approach.

Horribly unfocused company.

[Emre Switzer @EmreSwitzer]

@DeepValueBagger @BrokenToysInv What challenges do you see on the horizon?

I see a disruptive, compounding business at a cheap multiple because macro headwinds.

10Y @ 4.65% is peak. High chance of re-rating as we normalize. Rate sensitives are too aggressively discounted IMO

[Emre Switzer @EmreSwitzer]

@JDR1024 @insiderinvests More acquisitions

[Emre Switzer @EmreSwitzer]

@yawlighthouse Very nice - always hated how much of Unreal is obfuscated behind binary, non human readable BS.

🙏🙏🙏

[Emre Switzer @EmreSwitzer]

@JakeSucky That cylindrical distortion is lovely

[Emre Switzer @EmreSwitzer]

@sandpenguin Being able to jump between any discipline whenever you feel is also so refreshing...

[𝐬𝐨𝐯 @sovietsoleri]

Like tears in rain

[Emre Switzer @EmreSwitzer]

Now I understand: https://t.co/8AggSDeCGK

MW's statement around booking borrowing as loan sales is so horribly misleading.

I think maybe other retail folk might be getting caught up on this same wordplay...

One interpretation sounds like genuine fraud, the other is a sound business move and is more or less required with Dodd-Frank 5% risk-retention requirements. Unless you understand the capital stack & role of mezzanine, its hard to differentiate.

[Emre Switzer @EmreSwitzer]

Thank you - understanding that the $312M is SoFi’s own retained interest in a pool of its own loans, NOT a brand-new loan that SoFi made to a third-party buyer was the key insight and flipped my entire understanding of this.

"Mezzanine lender" means nothing to the average joe, so I incorrectly assumed this was some descriptor of the lending activity (to a LPB buyer) - not a part of the capital stack.

So then UCC filing covers SoFi's own mezz interest? Not interest on the senior / other parts of the capital stack?

And MW's whole point is because there is a mezz interest, the loan doesn't count as a sale?! What!?

Now I see why MW's claims are ridiculous! How can they claim it violates the tests for a true sale!? What a joke...wow

[Emre Switzer @EmreSwitzer]

Thank you - understanding that the $312M is SoFi’s own retained interest in a pool of its own loans, NOT a brand-new loan that SoFi made to a third-party buyer was the key insight and flipped my entire understanding of this.

"Mezzanine lender" means nothing to the average joe, so I incorrectly assumed this was some descriptor of the lending activity (to a LPB buyer) - not a part of the capital stack.

So then UCC filing covers SoFi's own mezz interest? Not interest on the senior / other parts of the capital stack?

And MW's whole point is because there is a mezz interest, the loan doesn't count as a sale?! What!?

Now I see why MW's claims are ridiculous! How can they claim it violates the tests for a true sale!? What a joke...wow

[Emre Switzer @EmreSwitzer]

@marketswithmay My understanding is this also really isn't that big of a deal, as the total credit exposure is rapidly dropping, implying pre-payments + LPB buyers adding more exposure to the underlying loans?

Drawing the original 312M -> 144M in just over a year

https://t.co/Gu7ozTUwGk

[The Departed @MadolynMaddenMD]

@muddywatersre You can enhance your LPB analysis with call report data...

[Emre Switzer @EmreSwitzer]

May, massive respect for the work you put in. But as a long all the LLMs have me worried:

His entire rebuttal is "the CFO said it was a sale, and SoFi's 10-K discusses true sale criteria." That's circular.

What's notably absent is any engagement with the actual UCC filing — the document showing JPMorgan as "Senior Lender" and SoFi as "Mezzanine Lender" on 9/30/2024.

Deloitte's audit provides some comfort, but ultimately auditors audit what management presents to them.

Did Deloitte know SoFi was financing the purchases of its own loans? If Deloitte received a True Sale Opinion that characterized these as arm's-length sales — without the auditors independently pulling UCC filings to verify the simultaneous pledge-backs — they may have relied on incomplete information while technically following audit standards.

This whole thing has me sketched out. I don't think SoFi is anywhere near doing anything illegal. But are they potentially mis-categorizing things for EBITDA window dressing?

Could regulators open an investigation and push things down even more? Could re-statement be on the table?

Ultimately doesn't matter if you own shares, but I could see shorter term headwinds.

[Emre Switzer @EmreSwitzer]

@CarioCapital @AIStockSavvy duh... Brave search sucks

ty ty

[Emre Switzer @EmreSwitzer]

@CarioCapital @AIStockSavvy Sure - but I can't find this report.

Notes around the sale are plenty.

[Emre Switzer @EmreSwitzer]

Some experimentation, no textures yet - But I like the vibe I have going with this one.

#gamedev #gaming

[Emre Switzer @EmreSwitzer]

@joelsmith7819 @sachinvats Every metric is what I would expect for a fintech growing 1m+ members a quarter.

What makes you think fraud? FV instead of CECL? LPB lending & collateral concerns?

They are federally chartered. It makes no sense from them to take those risks, esp. with their growth profile.