There are many, many, many implications to this, but zooming in on just one because it is probably surprising: a large portion of engineering compensation is now dependent on interest rates, but functionally no engineers model their compensation as if this were true.
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Speaking generally, increases in interest rates should cut the value of stocks, including e.g. RSUs issued by AppAmaGooBookSoft, and decreases should increase their value. Since engineering offers are set by a competitive market with material reference to AppAmaGooBookSoft...
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“My salary is a complex financial derivative” is a very counterintuitive result for many people for whom it is true.
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(FWIW I think that people should probably concentrate on the idiosyncratic risks part of that derivative rather than the interest rate part but it’s worth at least understanding that it is there so you don’t do something like get an ARM thinking ‘If rates rise, equity covers it’)
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(FWIW a lot of people would use “complex financial derivative” as a slur. I’m just using it in the positive sense. I broadly think equity ownership by employees is one of tech’s major structural innovations and is a huge portion of ongoing renegotiation of how the pie is split.)
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(There exist many options to trade off legibility / certainty for upside if legibility / certainty are more important to you, and there are many firms which are happily selling what you’re buying.)
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This is the kind of stuff I’d like to learn and understand more (since you were asking what you should write about). I would happily pay for the newsletter of a topic like this twice a month :)
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Also: just because someone has made a million dollars on their primary residence didn't necessarily make it a good investment, even in hindsight! And the same thing may not happen to you if you buy a house!
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I think we’ll look back and say — gee trying to measure inflation by a heavily manipulated consumer price index was obviously really dumb
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Bigger issue is probably using the same inflation measure regardless of whether it’s caused by commodities, wages, or monetary policy. Approximately 0 chance that the correct response for all of those is the same.
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