Yes, there’s limitations to hedging. The problem here is making a huge directional bet that interest rates won’t go up, not adjusting that bet as it becomes cl

Yes, there’s limitations to hedging. The problem here is making a huge directional bet that interest rates won’t go up, not adjusting that bet as it becomes clear they will go up, not adjusting as they start going up, etc. It’s like you bought a stock with half your portfolio that’s clearly going to suffer and you hold on hoping you’ll be able to get your money back in 10 years. Oh and using 10x leverage too, so even a 20% drop is enough to wipe out your portfolio completely. It’s just so stupid. And predictably stupid.