Illiquid Insights
The financial press and Substack have turned sharply negative on private credit.
Some are even claiming it could trigger a market crisis.
But the reality is a lot more measured.
Private credit is going through its first real stress cycle, not a systemic collapse.
Why Private Credit is Struggling:
Defaults are rising from artificially low levels
Heavy software exposure is facing AI uncertainty
Redemption pressure is testing illiquid fund structures
Read the full breakdown below.
On the Radar
Other articles worth your time this week.
Recovery Turbulence (S&P Global) - Loan recoveries in bankruptcy have declined as protections have weakened.
Opportunistic Credit (Davidson Kempner) - Strain in private equity and direct lending has increased the opportunity set for special sits credit.