$Alphabet(GOOGL)$ The CDS mark

$Alphabet(GOOGL)$ The CDS market for AI-related debt is in a bubble itself — the market is just so inefficient. It has created a dynamic I call coupon clipping. The play is to orient short bonds and stock, buy less liquid CDS as influence, then on the back end buy yields into the weakness until fully hedged. I think there is an opportunity in AI-related debt as investors get carried away with buying CDS momentum. Google's earnings showed the ROI is there, the cash flows are there, and the glide path should calm bond holders, but no, the CDS momentum is just too strong. One word, one headline, and the CDS trade blows up. The META headline about using excess capacity to build a datacenter leasing vertical is a good example.

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