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Judgment & ambiguity · When to act

Funding costs are creeping up and a few early indicators suggest liquidity could tighten fast, but nothing has broken and acting early means real, visible cost with no obvious payoff. When do you move to shore up liquidity versus wait for a clearer signal?

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Liquidity is the one risk where I move early on purpose, because the cost of acting is a small, certain drag and the cost of waiting is occasionally the whole firm — that asymmetry decides it before the signals are clean.

The full answer: structure, worked example, likely follow-up.

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