He thinks a market cycle usually cracks first with a major debt default, not with equity losses. Listen
Ganesan reasoned that equity losses are simply written down, whereas debt holders expect repayment, so leverage is what breaks cycles. He said that with leverage, being right is not enough: you also have to get the timing right.
“I think usually the first sign comes with some major debt default. Generally, equity is never the reason why these things crack”
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