00:00You were nervous about software before two weeks ago.
00:03On the other hand, in terms of when it comes to kind of digital infrastructure,
00:08there you're still fairly, you're less cautious.
00:12So I'd say I'm going to give you a more specific answer
00:15because it requires a more specific answer.
00:18In our private equity portfolio, which is not the subject of this,
00:21we have zero software.
00:23In our credit book, across the totality of the firm,
00:27it's a fraction of assets.
00:28We run a broadly diversified credit book
00:32that is not concentrated in software.
00:34The problem with software is that it was 30% of the levered buyout market.
00:38Therefore, it was 30% of the levered lending market.
00:40And therefore, it is just overrepresented and subject to attack.
00:46But we should not deny that change is coming.
00:49And change is not coming just in data centers and AI.
00:53As a world, we are building infrastructure.
00:55We're building energy.
00:57We're doing energy transmission.
00:58We're building next-gen manufacturing.
01:00We're ramping defense.
01:01And we're doing this thing called AI and data.
01:04We're essentially spending every dollar since the creation of FIRE.
01:07And we're doing it all at once.
01:08And whatever we're doing in the U.S., they want to do in Europe.
01:11And they're not as well prepared to it.
01:13And they're doing it in the Middle East.
01:14And they're doing it elsewhere around the world.
01:15We will see the largest need for capital ever.
01:19And that's what we've seen so far this year.
01:21And so now to your specific question, it's about underwriting.
01:25There are a number of very strong U.S. tech companies who run diversified businesses, Amazon, Google, Microsoft,
01:34who are interested in seeing these centers built and are interested in not consolidating the debt on their balance sheet.
01:40And to the extent they are prepared to lend their credit, one can lend against those types of things and
01:47make sensible underwriting decisions.
01:48So, let's get started.
Comments