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Not sure if your comparison is so great.. are there apartments whose rent price fluctuates over 1000%? Also subletting is not selling..
by fileeditview 6y ago
Not sure if your comparison is so great.. are there apartments whose rent price fluctuates over 1000%?
Also subletting is not selling..
- deetsb 6y ago1) I'm not sure the magnitude of change is relevant to the analogy -- it doesn't alter the mechanics as much etc. 2) You can view renting as a sale -- the renter buying the utility of the space in exchange for a series of cash flows (but not paying for the economic upside/downside). Financial markets have the ability to separate components of assets (ex. voting vs non-voting shares) and value them; there's no reason to not do the same here. In that structure a sublet is simply a rent on a rent.
- djoldman 6y agoMy point is that it's not clear to me how the mechanism of short-selling itself implies market manipulation. Point taken on how subletting is not selling.