The Credit Edge by Bloomberg Intelligence Oaktree Sees Companies in Trouble as Rates Stay High
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Nov 21, 2024 
David Rosenberg, head of liquid performing credit at Oaktree Capital Management, shares his expertise on credit markets and investment strategies. He predicts a boom in private credit for troubled companies due to high interest rates, highlighting rescue financing opportunities. The discussion also covers the anticipated surge in mergers and acquisitions and contrasts U.S. and European investment landscapes. Rosenberg emphasizes the need for strategic credit analysis and navigating challenges amid economic shifts and geopolitical risks.
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Credit Picking
- The ability to pick good credits will become more important than in the past five or six years.
- Higher interest rates mean attractive yields if companies don't default.
Rate Predictions
- The market expects a smooth decline in rates, not a step function drop.
- Successive, rapid rate cuts make less sense without a crisis.
Consumer Strain
- Indicators like declining fast-food traffic and increased car repossessions show low-end consumer strain.
- Middle and high-end consumers remain strong.