00:00You know, you think about what's going on in private credit, the turbulence that we've seen
00:03there. It's not necessarily related to what's going on in the economy. It's more about software
00:08exposures and, you know, the existential questions that AI poses. We were just talking with one of
00:14our Bloomberg reporters that you think about the size of the private credit market right now. It's
00:20unlike what we've seen in past episodes of stress just because it is so much bigger. So in some
00:25ways, this feels like the first real stress test. Yeah, you've had market prognosticators call it
00:32the adolescent phase or a hiccup. And I think that's right. As we look at the opportunities out
00:38there, dispersion creates opportunity. Change creates opportunity. So what we're seeing now
00:44is a great entry point. You had the golden age of private credit a few years ago. A lot of
00:50money
00:51was raised in these interval funds and non-traded BDCs, and they had a mandate to invest the money.
00:58The supply of that is private equity deal flow for direct lending strategies. So they bought what
01:04was on offer because they were raising capital for that. Now we've gone three years and there's
01:09been change. So some of those deals that were underwritten by private equity firms at the time
01:14look like they're going to have a different outcome because of technological change.
01:17I think the credit may or may not suffer in that. We'll see as valuations change in public companies.
01:25But what we are going to see is a tremendous opportunity in the market to go deploy capital
01:30again because now you have dispersion of outcome, creating less capital in the market and new
01:36knowledge to go create new opportunities.
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