Financial crisis worsen when the big money boys no longer trust one another to make good on their debts. Private credit is such an area. Several years ago Apollo's Marc Rowan referred to private credit as investment grade (which is wasn't then and clearly is not now). Financial advisors pushed private credit and private equity into individual accounts, many of them 401k's and IRAs.
Take Ares Strategic Income Fund, which recently reported:
Ares has restricted redemptions from the $22.7 billion Ares Strategic Income fund after exit requests reached 11.6% in the first quarter. The firm said the majority of repurchase requests were made by a limited number of family offices and smaller institutions in select geographies who represent less than 1% of our over 20,000 shareholders.
Family offices and likely sovereign wealth funds (SWF) are cousins of private equity underwriters (PEU). Many PEUs branched into private credit (you finance my junk, and I'll finance yours).
Family offices are financial behemoths who know what happens when credit goes bad. Those who wait for the promised lifeboats find out no more exist.
The Trump administration is too busy front running their key strategies to care about retirees losing their annuities, pension benefits or retirement savings.
Trump II is in that exclusive group that will take theirs and run. This will happen long before the pain spreads enough for them to actually be held to account for their actions that encouraged fiction and fraud.
Trump II is the greatest taker in our country's history, fueled by the world's greatest military might. We've never really seen anything like it. His savage, dangerous, militarized focus is like the Greek God Ares himself, the God of Excursions.
