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The plunge in software debt creates opportunities to buy cheap loans from companies that will survive AI disruption, according to Permira Credit. “The market has overreacted,” Ian Jackson, the firm’s head of strategic opportunities, tells Bloomberg News’ James Crombie and Bloomberg Intelligence’s Tolu Alamutu in the latest Credit Edge podcast. “The broad selloff in software has been such an interesting place for us because a lot of these names, we just don’t believe will go through restructuring,” says Jackson, whose company lends to technology companies. They also discuss fraud, private market stress, relative value in Europe vs. US credit and the outlook for collateralized loan obligations.

The plunge in software debt creates opportunities to buy cheap loans from companies that will survive AI disruption, according to Permira Credit. &ldquo;The market has overreacted,&rdquo; Ian Jackson, the firm&rsquo;s head of strategic opportunities, tells Bloomberg News&rsquo; James Crombie and Bloomberg Intelligence&rsquo;s Tolu Alamutu in the latest Credit Edge podcast. &ldquo;The broad selloff in software has been such an interesting place for us because a lot of these names, we just don&rsquo;t believe will go through restructuring,&rdquo; says Jackson, whose company lends to technology companies. They also discuss fraud, private market stress, relative value in Europe vs. US credit and the outlook for collateralized loan obligations.

The Credit Edge reviews the top credit news of the week and looks at the week ahead, with in-depth research of the most important corporate sectors, trends and themes. Analysis of specific corporate bonds and credit default swaps is backed by Bloomberg Intelligence's robust data sets and indexes.

The Credit Edge reviews the top credit news of the week and looks at the week ahead, with in-depth research of the most important corporate sectors, trends and themes. Analysis of specific corporate bonds and credit default swaps is backed by Bloomberg Intelligence's robust data sets and indexes.

The Credit Edge by Bloomberg Intelligence

European PE Giant Permira Looks to Buy Beaten Up Software Loans

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/60b45911-8f1d-42a9-ab2e-b41900f4820c/transcript

A borrowing boom among technology companies and governments is upending debt indexes, raising questions about their relevance to investors. “We’re actually starting to think about whether managing versus a benchmark makes a whole heap of sense,” Ross Pamphilon, Impax Asset Management’s fixed income chief investment officer, tells Bloomberg News’ James Crombie and Bloomberg Intelligence’s Tolu Alamutu in the latest Credit Edge podcast. “You’re going to end up owning a lot of US Treasuries if you’re in the aggregate index and a lot of tech if you’re in the US investment-grade index,” says Pamphilon, who estimates that about 12% of the high-grade market is now AI or AI related. They also discuss climate risk, opportunities in mortgage-backed debt plus the timing and severity of the next credit cycle.

A borrowing boom among technology companies and governments is upending debt indexes, raising questions about their relevance to investors. &ldquo;We&rsquo;re actually starting to think about whether managing versus a benchmark makes a whole heap of sense,&rdquo; Ross Pamphilon, Impax Asset Management&rsquo;s fixed income chief investment officer, tells Bloomberg News&rsquo; James Crombie and Bloomberg Intelligence&rsquo;s Tolu Alamutu in the latest Credit Edge podcast. &ldquo;You&rsquo;re going to end up owning a lot of US Treasuries if you&rsquo;re in the aggregate index and a lot of tech if you&rsquo;re in the US investment-grade index,&rdquo; says Pamphilon, who estimates that about 12% of the high-grade market is now AI or AI related. They also discuss climate risk, opportunities in mortgage-backed debt plus the timing and severity of the next credit cycle.

AI Blitz and US Borrowing Binge Are Disrupting Debt Benchmarks 

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/bd0485d3-5a41-4b1e-b70a-b4f2012cc2aa/transcript

Mom-and-pop investors are buying hyperscaler debt after a selloff that has hit bonds with long maturities particularly hard, according to R. Seelaus & Co. “You’re just seeing absolute yields in long Meta paper, or a household name, that retail is starting to find really attractive,” Annie Seelaus, chief executive officer of the broker dealer and asset manager, tells Bloomberg News’ James Crombie and Bloomberg Intelligence’s Arnold Kakuda in the latest episode of the Credit Edge podcast. “That’s a microcosm of a bigger pocket of demand that’s out there,” says Seelaus, who notes that investors are moving into bonds as stocks become vulnerable to a correction. They also discuss secondary-market liquidity, contagion risks, the asset-backed security boom, private credit turmoil and how to invest in data centers.

 

Mom-and-pop investors are buying hyperscaler debt after a selloff that has hit bonds with long maturities particularly hard, according to R. Seelaus &amp; Co. &ldquo;You&rsquo;re just seeing absolute yields in long Meta paper, or a household name, that retail is starting to find really attractive,&rdquo; Annie Seelaus, chief executive officer of the broker dealer and asset manager, tells Bloomberg News&rsquo; James Crombie and Bloomberg Intelligence&rsquo;s Arnold Kakuda in the latest episode of the Credit Edge podcast. &ldquo;That&rsquo;s a microcosm of a bigger pocket of demand that&rsquo;s out there,&rdquo; says Seelaus, who notes that investors are moving into bonds as stocks become vulnerable to a correction. They also discuss secondary-market liquidity, contagion risks, the asset-backed security boom, private credit turmoil and how to invest in data centers.
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Mom-and-Pop Buyers Pounce on Battered Hyperscaler Bonds, Says Seelaus

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/148a3732-8535-4027-9894-b4eb0149bd05/transcript

TCW’s $160 billion fixed-income group has slashed credit risk to the lowest in three decades amid valuation and contagion concerns. “Look back over the last 30 years — you would not find a period where we had less exposure to both investment-grade and high-yield bonds as we do today,”Bryan Whalen, the group’s chief investment officer, tells Bloomberg News’James Crombie and Bloomberg Intelligence’sJody Lurie in the latest episode of the Credit Edge podcast. They also discuss the potential for distress in debt rated CCC to spread to other parts of the corporate debt market. “That is the weakest borrower, and they cry uncle first,” says Whalen, referring to CCCs. “Make no mistake about it — your single B borrower is going to feel it next, and then your double B borrowers.”

TCW&rsquo;s $160 billion fixed-income group has slashed credit risk to the lowest in three decades amid valuation and contagion concerns. &ldquo;Look back over the last 30 years &mdash; you would not find a period where we had less exposure to both investment-grade and high-yield bonds as we do today,&rdquo;Bryan Whalen, the group&rsquo;s chief investment officer, tells Bloomberg News&rsquo;James Crombie and Bloomberg Intelligence&rsquo;sJody Lurie in the latest episode of the Credit Edge podcast. They also discuss the potential for distress in debt rated CCC to spread to other parts of the corporate debt market. &ldquo;That is the weakest borrower, and they cry uncle first,&rdquo; says Whalen, referring to CCCs. &ldquo;Make no mistake about it &mdash; your single B borrower is going to feel it next, and then your double B borrowers.&rdquo;

TCW Chops Credit Risk to Lowest in 30 Years as CCCs ‘Cry Uncle’

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/438e5ddd-4f02-4557-99c7-b4e4012fad94/transcript

European PE Giant Permira Looks to Buy Beaten Up Software Loans

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