With 10 IOUs it’s unlikely [they’ll] all default, so the asset is safer and your risk models can assess this.
This is where my spider senses go off. Are we assuming that these IOUs defaulting are independent events? Even though they’re from 10 crack heads talking about stealing the same generator?
Yes, probability gets much messier with correlated events, and most models assume independence. You can vary intensity/hazard in counting processes, but really there’s not much you can do at a certain point.
This is where my spider senses go off. Are we assuming that these IOUs defaulting are independent events? Even though they’re from 10 crack heads talking about stealing the same generator?
Yeh and they all hang out with each other and bribe the same
policesenators and bulk buy theircrackdreams from the samedealer3 AI companiesYes, probability gets much messier with correlated events, and most models assume independence. You can vary intensity/hazard in counting processes, but really there’s not much you can do at a certain point.