Money Stuff: The Podcast No Nap Rooms: Credit, Peace, 24X
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Oct 17, 2025 Katie and Matt dive into the chaos of late-cycle credit accidents, likening them to cockroaches that scuttle out when trouble brews. They dissect the clash between private credit and banks, revealing the implications for loan quality. The duo ponders a curious Polymarket win linked to the Nobel Peace Prize announcement. They also explore the wild world of 24-hour trading and its impact on retail investors, pondering whether markets can ever truly be automated while appreciating the human quirks that persist amid the chaos.
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Late-Cycle Credit Risks
- Late-cycle credit failures signal frothy lending and weakened underwriting across private and public lenders.
- Firms rush to place capital and may loosen standards, creating “accidents” like First Brands and Tricolor.
Concentration From Origination Pressure
- A fund heavily concentrated in one borrower shows how origination pressure creates overexposure.
- Matt describes funds accepting large volumes of paper from a single provider to fill products.
Private Credit’s Structural Tradeoff
- Private credit claims steadier funding because it relies on long-term equity rather than deposits.
- However, massive fundraising can pressure firms to deploy capital and loosen underwriting too.
