Seix Fears More Zombie Borrower Distress as Interest Rates Stay High

Pressure on highly-indebted companies will intensify as interest rates remain elevated, according to Seix Investment Advisors. “We have a lot of credit zombies — B3/B minus or CCC rated credits — that still have very weak interest coverage, generating zero free cash flow,” George Goudelias, chief i…

Neuberger Sees More Gain Than Pain in Private Debt Market

Despite all the negative headlines around private credit, Neuberger Berman says direct loans pay a lot more than traded debt and barely make a loss. “We pretty consistently see a 200 basis point differential,” Susan Kasser, the gobal investment management firm’s head of private debt, tells Bloomber…

The Long Road to Making Venezuela's Debt and Oil Investable Again

Venezuela debt holders will likely have to wait years to get their money back after regime change in the oil-rich nation, according to Bloomberg Intelligence. “The near-term challenges are nothing short of massive,” says Damian Sassower, chief emerging-markets credit strategist, in this special epi…

Inside ‘the Everything Bubble’ With RBA

Credit is one of many overvalued markets and the technology sector is particularly risky, according to Richard Bernstein Advisors. “We’re kind of in an everything bubble at the moment,” Mike Contopoulos, the firm’s deputy chief investment officer, tells Bloomberg News’ James Crombie and Bloomberg I…

Newfleet Warns of ‘No Free Lunch’ in AI Debt Funding Frenzy

Long-term debt bets on technology companies that are borrowing heavily for AI may end in tears, according to Newfleet Asset Management. “It’s one of the biggest risks out there,” said Dave Albrycht, the multi-sector fixed income manager’s president and chief investment officer. “There’s no free lun…

KKR Is Hunting for Yield in European and Japanese Credit Markets

KKR is looking to Europe and Japan for yield as US debt spreads grind tighter. “Investors are very focused on relative value in a market where there’s not a lot,” Tal Reback, global investment strategist for the firm’s credit and markets business, tells Bloomberg News’ James Crombie and Bloomberg I…

Barclays’ Rogoff Sees Risk of AI Bust as Debt Issuance Ramps Up

The technology-funding frenzy could become a bust for credit markets if AI falls short of lofty expectations, according to Barclays. “If we get to a point where we see a lot of this issuance coming to the market — and then there’s some changes, where maybe certain things are a little bit less viabl…

Arini Says European Private Credit Has the Edge Over US Market

Global investors are looking more at European private credit as US returns get squeezed, according to London-based hedge fund Arini. “They want to focus on a place where they think there’s rule of law, where they think there’s opportunity set — and that’s really been Europe,” Mathew Cestar, the fir…

Vanguard Says Junk Bond Pricing Leaves Little Room for Negative Surprises

Vanguard Group, the world’s second-largest money manager, is wary of junk bonds given how expensive they’ve become. “Where the market is today doesn’t leave a lot of room for negative surprises,” Michael Chang, head of high-yield corporate credit at the $11 trillion asset manager, tells Bloomberg N…

Oaktree Worries About Lack of Discipline in Rush to Fund AI

Lack of discipline is a concern for credit markets as investors rush to fund artificial intelligence, according to Oaktree Capital Management. “Just how much money is chasing deals — I think you need to be mindful of that,” Danielle Poli, a portfolio manager for the firm’s global credit strategy, t…