00:00Well, Neha, why in here? Because, I mean, you do think about the landscape and certainly there's a lot you
00:05could get worked up about.
00:06Not necessarily seeing that in credit spreads, but where are you seeing the opportunity right now?
00:11Yeah, there's plenty to sort through. Well, first of all, to Rick's point, credit markets are resilient.
00:17And I think there's one word that encapsulates the mentality is attractive yields.
00:23Because yields are attractive, so spreads are less concerning.
00:26We have spreads at 5th percentile. It doesn't matter because IG yields give or take 85th percentile relative to history.
00:33So as long as we see attractive yields and the incremental dollar coming from total return investors, we think that
00:38the demand in the credit landscape will remain strong.
00:41In terms of opportunities, we came into the year on the defensive because we thought AI ops license risk was
00:46real and it could create disintermediation and dispersion.
00:50And so we stick with that call of being down in duration, high in quality and expect lots of duration.
00:56Interesting. And I mean, with that in mind, what do you make of all the issuance, Neha, that's coming through
01:01when it comes to the hyperscalers?
01:03Because, you know, they've been entering the market and stepping up in a big way when it comes to overall
01:08issuance.
01:09Yeah, I mean, that's the spotlight. I mean, that's really where all the issuance in the credit market is really
01:14coming from.
01:14In the left-hand space, everybody was expecting this big M&A wave that didn't really materialize given how many
01:22tail risks are slowly bubbling up.
01:23But in the IG space, because yields are attractive, there's plenty of demand and there's also a lot of supply.
01:29So it's kind of like a happy marriage right now.
01:32We expect about $175 billion in hyperscaler supply for this year, which should taper down all things equal next year.
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