Closing Bell Closing Bell: 10/1/25
Oct 1, 2025
Mark Lazzari, Chairman and CEO of Avenue Capital Group, dives into the intricacies of private credit risks and the importance of Fed independence amidst political pressures. He shares insights on Avenue's new sports fund focusing on investments in NASCAR, baseball, and soccer. Chris Verone from Strategas discusses the macro outlook for the quarter, examining market signals and expectations for rate cuts. They both highlight the potential impacts of recent economic events, offering a comprehensive view of the financial landscape.
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Private Credit Vulnerability
- Private credit risks are rising because borrowers took aggressive leverage during easy-money years.
- Opacity on leverage multiples makes it hard to assess systemic risk, potentially leading to a mini recession if growth slows.
Lend With Tight Terms
- Lend conservatively and set strict terms when borrowers have limited options.
- Keep leverage low (around three to four times EBITDA) to stay adequately covered.
Fed Shifts Toward Easing
- The Fed will likely pivot to cutting rates if the labor market weakens further.
- Lower rates could stave off a recession by reducing corporate capital costs.