Eurodollar University Something Is Breaking in Private Credit
Jan 9, 2026
A deep dive into the turmoil facing Blue Owl reveals unsettling trends in private credit. Withdrawals surge, marking a shift in investor behavior and signaling potential credit cycle troubles. With banks supplying emergency liquidity, the decline may be stalled, but risks loom. The podcast explores how bad loans and lax oversight expose a bubble, while concerns grow about the broader implications for the credit market. As dealers hoard Treasuries, a defensive stance underscores the uncertainty ahead.
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Stage-One Confirmed By Withdrawals
- Private-credit withdrawals confirm a stage-one credit-cycle downswing marked by investor panic over 'garbage' underwriting.
- This phase shifts behavior from volume-chasing to scrutiny and withdrawal across funds.
Cockroaches: Tricolor And First Brands
- Tricolor and First Brands exposed sloppy underwriting and lack of due diligence among large fund managers.
- Jeff Snider compares the behavior to past credit bubbles like Ninja Mortgage to illustrate repeating patterns.
Investor Redemptions Signal Full Phase One
- Stage one becomes full when investors start demanding redemptions en masse from private-credit funds.
- UBS fund closures signaled withdrawals were spreading beyond isolated cases.