We are in a debt trap. Our political process can’t reduce spending and/or raise taxes enough to balance the budget, so the debt grows and grows. As it does, paying the interest plus the accumulated debt load pulls more capital away from more productive uses. This depresses economic growth, thereby generating even more spending and debt.
In 3Q26, global fixed-income markets continue to navigate a complex backdrop as resilient growth, elevated inflation, hawkish central-bank pricing and the AI infrastructure buildout intersect. Growth remains supported by the US consumer, fiscal spending in Europe and AI-related capital investment, while inflation is expected to moderate through 2026 and into 2027.
Demand continues to outpace record supply. Municipal bonds remain an attractive income opportunity in a market where the Federal Reserve (Fed) is likely to remain on hold and carry is driving returns. Despite record issuance of roughly $50 billion per month, demand has remained strong, supported by a reinvestment wave that is running approximately 40% above last year and favorable summer technicals.
Our thesis remains largely unchanged. Today's “exploding” CDS spreads and bond yields are pricing an Oracle problem. The question investors should be asking isn't whether Oracle is an outlier. It clearly is. The question is whether Oracle is a preview of what happens to credit markets more broadly if AI capital spending keeps outrunning AI revenue.
Chris Galipeau discusses high-conviction insights that go beyond media headlines.
Goldman Sachs Group Inc. is setting up a reinsurance vehicle with Talcott Financial Group that has so far raised $1 billion.
Power utilities across the US are already strained from AI data centers. But they’re increasingly facing an even bigger threat: that developers will be forced to walk away from projects, leaving households on the hook for massive infrastructure bills.
Just as important, the dollar and U.S. Treasuries have continued to behave like hedges in periods of broader market unrest (driven by geopolitics or other conditions). When risk assets come under pressure, Treasury yields have generally fallen, or the dollar has tended to find support.
Lately, it seems like you can’t open a financial publication without stumbling across another article declaring the 60/40 portfolio dead. The pitch is everywhere: bonds are broken, the old rules no longer apply, and investors should modernize by swapping the bonds in their portfolio for Bitcoin, gold, or whatever alternative the asset management industry is currently selling.
There are 38% fewer companies listed on U.S. exchanges today than at the peak in the mid-1990s. The forces behind that decline—regulatory burden, the abundance of private capital, and the quiet disappearance of mid-sized public companies—are structural, not cyclical.
Schwab Sector Views is our six- to 12-month outlook for stock sectors, which represent broad sectors of the economy. The Schwab Center for Financial Research (SCFR) combines a factor-based approach with a market and economic assessment to determine the ratings.
GMO’s liquid alternatives are hedge fund strategies (e.g., equity long-short, global macro, event-driven) managed with an emphasis on risk control and liquidity. The GMO Alternative Allocation Strategy (“ALTA”) is a liquid alternative solution combining several underlying strategies; ALTA is available in a mutual fund with daily liquidity.
Private equity has become easier than ever for individual investors to buy. Founders, executives, physicians, and business owners now regularly see private funds offered through banks, wealth platforms, feeders, evergreen vehicles, or registered interval funds. However, just because these funds are more readily available, and at lower minimums, does not mean they should immediately be invested in.
At the party, hosted on a hot day last July at HPS business development head John Christmas’ New Jersey beach house, bandana-clad colleagues across his teams mingled poolside with the wind at their backs. With the addition of HPS, one of the biggest names in private credit, it seemed BlackRock was set to break through in the market in a way that had eluded the asset manager for years.
Leverage, ratings arbitrage, liquidity transformation, and a growing willingness to embrace complexity and illiquidity are becoming more visible across parts of the financial system.
Discover Aberdeen’s closed-end funds (CEFs) for high yields, illiquid assets, long-term investments, and resilient income for 2026.
If you own treasuries, you need to make two separate decisions rather than one blended bet. The liquidity sleeve holds the bill exposure and does the work people mistakenly ask the long end to do. The duration sleeve stays deliberately small, sized as recession insurance rather than as a conviction call on falling inflation.
Pimco has been one of the loudest voices warning of risks in private debt markets, and Ivascyn, 56, has cautioned on the trillions of dollars pouring into the infrastructure underpinning the artificial intelligence boom.
Goldman Sachs Group Inc. and T. Rowe Price Group Inc. are launching their first interval fund for the masses as Wall Street races to bring private investments to Main Street.
In the Warsh Fed's new era of two-way risk, bonds offer something rare: potential downside risk mitigation that investors get paid to hold.
Blackstone Inc. leaned on Wellington Management Co. and Vanguard Group to create two new funds that will give individual investors access to private assets as it looks to go beyond its roots as a money manager for pensions and institutions to become more of a household name.
The relative cheapness of Treasuries versus interest rate swaps mechanically affects how corporate bond spreads are measured, but it appears to have limited influence on how corporate bond spreads actually behave.
Government bonds are back in focus, as investors reassess where value lies in global fixed income. With markets wavering over how quickly interest rates will fall, sovereign debt in several developed economies is starting to look attractive again to us.
Private debt is increasingly valued for its potential to help insurers operationally and strategically: support liability matching, improve portfolio design, diversify underlying exposures and, when underwritten well, add resilient excess return.
The Q2 earnings season is off to a rollercoaster start. The big banks collectively reported strong numbers, boosted by active capital markets and another impressive set of sales & trading revenue. And it was the usual chorus of bank CEO macro commentary:
Although economic conditions did not change much between the first and second quarters, investors were far more bullish in the second quarter.
The universe of alternative investments is only growing. As advisors increasingly look for opportunities to diversify their client portfolios. But independent advisors who have purposefully built their businesses on doing what is best for their clients deserve to have partners who are doing the same.
BlackRock Inc. pulled in $192 billion of net client cash in the second quarter, with investors pouring money into exchange-traded funds and pushing total assets above $15 trillion for the first time.
Historically, many in the pension industry viewed funding above the "plan termination level" as having little incremental value. Once a plan reached “plan termination level”, thought of as roughly 110% funding, conventional wisdom suggested additional surplus had little economic value because it is effectively "trapped capital."
The Fed's recent shift into a more hawkish mode creates concern about banking profits later this year, but second-quarter results are seen strong thanks to IPOs, mergers.
To close the visibility gap, analysis must begin with the “borrower model,” not the fund. Once you know the types of businesses in a portfolio, their industry, revenue band, and geography, you can evaluate them against a statistically robust universe of similarly situated companies.
If you knew you were standing inside a stock market bubble, you wouldn’t be standing in it for long. You’d sell. So would I, and so would everyone reading this. And if spotting market bubbles was something everyone could do in real time, the bubble couldn’t form in the first place.
Almost two decades ago, when trillions of dollars in private housing debt proved unsustainable, governments had to step in to prevent the worst financial crisis since the Great Depression from eclipsing it.
Higher rates, weaker underwriting, and software concentration are exposing vulnerabilities in direct lending and leveraged loans, while high yield bonds appear better positioned.
Midway through 2026, Franklin Templeton Institute’s Global Investment Outlook framework remains a valuable lens—but the landscape has shifted.
AI-related disruption, asset valuations and borrower stress have put private credit under a microscope lately. Is this a market facing its first major test after a decade of rapid growth? If it is, we expect it to pass comfortably.
A look at the resilient global economy, evolving market opportunities, and key risks shaping the investment outlook.
The head of BlackRock Inc.’s beleaguered private credit fund is in the process of leaving the firm, a move that follows months of losses on soured loans and revelations of a US regulatory probe into the unit’s valuation practices.
A private bond market dating back more than a century is opening a new front in the trillion-dollar AI funding boom, allowing tech borrowers to sell debt directly to deep-pocketed insurance firms.
Insurance investors face a broader opportunity set than ever across public and private credit—from corporate lending to asset-based finance. But those investments come in many forms. In our view, a all-encompassing approach can better assess relative value, pivot to new avenues and align investments with portfolio, liability and regulatory considerations.
A widening confidence gap in non-traded investment vehicles is testing private credit valuations, sharpening the case for manager selection and diversification beyond direct lending.
From our experience participating in Fed meetings, we know that the dot plot has never been universally embraced within the institution. The concern was not that it lacked informational value, but rather that markets interpreted it as a forecast, which was never its intended purpose. Forward guidance is meant to shape expectations and influence behavior, not to serve as a firm prediction of future policy decisions.
Private credit is having a moment in the headlines. Higher interest rates and a pullback in certain types of bank lending have pushed more financing activity into private markets. Investors may be left with a simple question: What exactly is private credit?
According to Gleason, the freezing of Russian assets following the 2022 invasion of Ukraine accelerated the global push toward de-dollarization. Nations around the world took notice that access to the dollar-based financial system could be restricted, increasing the appeal of gold as a reserve asset that cannot be frozen or sanctioned by foreign governments.
The convergence of long-term structural drivers and emerging cyclical tailwinds suggests the industrial sector may be approaching an inflection point, with conditions increasingly supportive of new development.
In August 2025, the US President Donald Trump signed an executive order aimed at broadening the investments available in defined contribution plans (DC plans). On March 30, 2026, the US Department of Labor issued proposed guidance regarding a plan fiduciary’s selection of investments, including private market and other alternative investments, in 401(k) plans.
For insurers, fixed income remains the foundation of portfolio strategy. But while public markets have long provided unrivaled sourcing capacity and liquidity, the definition of “core” is widening.
One of the most debated topics in private credit is the size of the investment opportunity – or, in industry parlance, the total addressable market (TAM). But the way TAM is typically framed can be misleading.
As shareholders rush to pull money from private credit funds over troubling questions about software exposure, opaque loan values and non-payments, some bond investors are doing the opposite: buying their debt.
For more than four decades, PIMCO’s Secular Forum has provided a disciplined framework for stepping back from short-term market noise to assess the structural forces that will shape the global economy and markets over the next five years. Yet rarely has this exercise been more consequential than it has recently.
Ratings that underpin a growing slice of the $1.8 trillion private-credit market, the hottest corner of Wall Street in recent years, are systematically understating investment risk, according to a new study by Columbia Business School researchers.
Chris Galipeau and Taylor Topoussis discuss high-conviction insights that go beyond media headlines.
Credit heavyweights like DoubleLine Capital LP and Oaktree Capital Management are buying debt now that can perform well if the artificial intelligence boom turns into a credit bust.
In light of all this, our own view is that markets remain well positioned to continue to rally over the medium term, though given their stratospheric rise of late, a bit of a pullback might be in order in the short term.
The $1.8 trillion private credit industry is finding out that trying to shake investor angst about the market is more of a marathon than a sprint. Such is the nature of long-term lending — there are few quick answers to the concerns that the market became too concentrated on software assets, a sector that’s ripe for disruption by artificial intelligence.
Cliffwater LLC’s flagship private credit fund capped redemptions at 5% in the second quarter after investors looked to pull about 17% of shares, in a sign of enduring pressure on the $1.8 trillion market.
Learn what's in store for the remainder of 2026 and the challenges that lie ahead in our mid-year outlook for U.S. stocks and the economy.
A private credit fund jointly managed by Future Standard and KKR & Co. sold $900 million of junk bonds on Monday, according to people familiar with the matter, in a rare high-yield offering by a publicly traded credit fund.
Blackstone Inc. has entered an agreement to provide Nippon Life Insurance Co. with investment services, adding to an increasing number of tie-ups between private investment firms and Japanese insurers.
Private markets have become integral to modern portfolios, with many investors searching for higher returns and diversification, including from public markets. But recent fund redemptions have reinforced that illiquidity isn’t theoretical, raising questions about the benefits of giving up liquidity. We see several—but investors must understand the trade-offs.
Taylor Topoussis and Chris Galipeau discuss high-conviction insights that go beyond media headlines.
Many debates in defined contribution (DC) circles focus on fees, new asset classes, and ever more complex solutions. But the biggest improvement available to plan participants may come from something far simpler: how their fixed income is managed.
Bankers are preparing to sell a jumbo debt package to support the $110 billion acquisition of Warner Bros. Discovery Inc. It’s a risky deal and comes at a moment when the bond markets have been wobbling.
Private credit is more inherently complex than the traditional bond market. In comparison, private credit information comes at a deficit. That’s because private credit loans are essentially bespoke agreements between a lender and a private borrower.
Despite the move lower late last week, U.S. Treasury yields are still holding well above recent lows and close to highs not seen in more than a year. By contrast, risk assets are firmly bid: U.S. equities have been routinely touching new historical highs, and credit spreads over Treasuries remain tight.
This week marked the passing of former Massachusetts Congressman Barney Frank. His signature legislation, the Dodd-Frank Act of 2010, was the most recent increment in a long-running history of tighter financial regulation. Some of those rules are now coming under scrutiny, with the goal of making bank lending more competitive.
New AdvizorPro data shows RIAs broadened their ETF lineups in Q1 2026, leaning into real assets, active managers, and defense strategies.
Private markets (private equity, private credit and real estate) have historically delivered an “illiquidity premium”. Institutions and family offices have recognized this illiquidity premium and have historically allocated significant capital to capture it.
In this second quarter update, Western Asset believes global fixed-income markets face a more complex backdrop as geopolitics, rapid AI adoption and private credit scrutiny intersect.
For private equity firms, capital flexibility is prized today. Merger-and-acquisition (M&A) activity has cooled, while commodity prices and artificial intelligence (AI)-driven disruption have heated up, creating uncertainty for investors. This makes it more challenging to sell portfolio companies, so private equity firms are holding investments longer. As a result, many firms are turning to net asset value (NAV) loans for capital needs.
Private credit managers are increasingly turning to the once-unthinkable: Trading in and out of loans to dump troubled assets and hunt for bargains amid the industry’s first stress test after years of breakneck growth.
Even if armchair investors are fleeing private credit or panicking that their unlisted shares in Anthropic PBC are now invalid, the long-term trend is clear: Public markets keep losing ground to private funds.
While most institutional investors recognize that private equity and public equity share similar economic risks, they often seem to ignore how their aggregate equity portfolio is affected by their substantial allocation to private equity.
Although a lot has changed since our last quarterly, its central theme – dispersion – feels like it’s only become more pronounced. We wrote last time that ‘‘we believe we’re entering a new era of dispersion in the performance of financial assets.’’
The Texas Permanent School Fund bought more than 29 million shares totaling about $740 million worth of the State Street IG Public & Private Credit ETF, trading under the ticker PRIV, in the first quarter, according to a filing Friday.
As inflation lingers and market dynamics shift, advisors are rethinking the 60/40 portfolio with managed futures and options income ETFs.
The sooner the mass of retail private credit managers realize they are zombies and give up the ghost, the sooner we can burn the whole thing to the ground and conjure a better model from the ashes. But there is no time like a crisis to have conversations about how to make the structure work better for everyone in the future!
Semiconductor stocks, along with some computer hardware companies, are the market’s latest AI darlings. Momentum and gamma are driving the outperformance, and, in their wake, a supportive narrative is trying to justify it.
You are undoubtedly seeing in the news that high earners are leaving New York, Los Angeles, and other metro areas. This does not begin to address the magnitude of the problem. There are dozens of cities that are trending towards fiscal collapse. Indeed, taxpayers are leaving.
What were the key takeaways from last month’s numbers? Our corporate bond specialists look back at the market’s performance and provide incisive commentary to help you make sense of what drove the market—and what may be on the horizon for fixed income investors.
Stock markets have been hitting all-time highs and credit spreads remain low, yet higher interest rates and mounting floating-rate debt are straining lower-rated borrowers. This tension is surfacing first in leveraged loans as “quiet defaults” become more common — opening up a dynamic set of opportunities for investors specialized in stressed and distressed assets.
Private Credit
Caught in a Debt Trap
We are in a debt trap. Our political process can’t reduce spending and/or raise taxes enough to balance the budget, so the debt grows and grows. As it does, paying the interest plus the accumulated debt load pulls more capital away from more productive uses. This depresses economic growth, thereby generating even more spending and debt.
Key Convictions: Third Quarter 2026
In 3Q26, global fixed-income markets continue to navigate a complex backdrop as resilient growth, elevated inflation, hawkish central-bank pricing and the AI infrastructure buildout intersect. Growth remains supported by the US consumer, fiscal spending in Europe and AI-related capital investment, while inflation is expected to moderate through 2026 and into 2027.
Why Carry Is the Strategy
Demand continues to outpace record supply. Municipal bonds remain an attractive income opportunity in a market where the Federal Reserve (Fed) is likely to remain on hold and carry is driving returns. Despite record issuance of roughly $50 billion per month, demand has remained strong, supported by a reinvestment wave that is running approximately 40% above last year and favorable summer technicals.
Hidden Debt: Is Our Hyperscaler Thesis Wrong?
Our thesis remains largely unchanged. Today's “exploding” CDS spreads and bond yields are pricing an Oracle problem. The question investors should be asking isn't whether Oracle is an outlier. It clearly is. The question is whether Oracle is a preview of what happens to credit markets more broadly if AI capital spending keeps outrunning AI revenue.
Earnings Drive the Tape
Chris Galipeau discusses high-conviction insights that go beyond media headlines.
Goldman Sachs Creates $1 Billion Reinsurance Pool With Talcott
Goldman Sachs Group Inc. is setting up a reinsurance vehicle with Talcott Financial Group that has so far raised $1 billion.
AI Power Needs Spur Builders to Tap Billions in Bank Pledges
Power utilities across the US are already strained from AI data centers. But they’re increasingly facing an even bigger threat: that developers will be forced to walk away from projects, leaving households on the hook for massive infrastructure bills.
Still Buying America
Just as important, the dollar and U.S. Treasuries have continued to behave like hedges in periods of broader market unrest (driven by geopolitics or other conditions). When risk assets come under pressure, Treasury yields have generally fallen, or the dollar has tended to find support.
Bonds In Your Portfolio: Why Ditching Them Is The Wrong Move
Lately, it seems like you can’t open a financial publication without stumbling across another article declaring the 60/40 portfolio dead. The pitch is everywhere: bonds are broken, the old rules no longer apply, and investors should modernize by swapping the bonds in their portfolio for Bitcoin, gold, or whatever alternative the asset management industry is currently selling.
The Incredible Shrinking Market: Three Decades of De-Equitization—And the First Signs of a Turn
There are 38% fewer companies listed on U.S. exchanges today than at the peak in the mid-1990s. The forces behind that decline—regulatory burden, the abundance of private capital, and the quiet disappearance of mid-sized public companies—are structural, not cyclical.
WAIT. Wut?
Chris Galipeau discusses high-conviction insights that go beyond media headlines.
Sector Views: Monthly Stock Sector Outlook
Schwab Sector Views is our six- to 12-month outlook for stock sectors, which represent broad sectors of the economy. The Schwab Center for Financial Research (SCFR) combines a factor-based approach with a market and economic assessment to determine the ratings.
The Liquid Alternatives Revival
GMO’s liquid alternatives are hedge fund strategies (e.g., equity long-short, global macro, event-driven) managed with an emphasis on risk control and liquidity. The GMO Alternative Allocation Strategy (“ALTA”) is a liquid alternative solution combining several underlying strategies; ALTA is available in a mutual fund with daily liquidity.
Private Equity for Individual Investors: What the Minimums Really Mean
Private equity has become easier than ever for individual investors to buy. Founders, executives, physicians, and business owners now regularly see private funds offered through banks, wealth platforms, feeders, evergreen vehicles, or registered interval funds. However, just because these funds are more readily available, and at lower minimums, does not mean they should immediately be invested in.
BlackRock Sets Out for Private Credit Glory After Year of Upheaval
At the party, hosted on a hot day last July at HPS business development head John Christmas’ New Jersey beach house, bandana-clad colleagues across his teams mingled poolside with the wind at their backs. With the addition of HPS, one of the biggest names in private credit, it seemed BlackRock was set to break through in the market in a way that had eluded the asset manager for years.
The Return of Financial Engineering – Not 2008, But Not Nothing
Leverage, ratings arbitrage, liquidity transformation, and a growing willingness to embrace complexity and illiquidity are becoming more visible across parts of the financial system.
Earnings Strong. Bond Yields a Risk.
Chris Galipeau discusses high-conviction insights that go beyond media headlines.
As Uncertainty Persists, Consider Closed-End Fund Exposure
Discover Aberdeen’s closed-end funds (CEFs) for high yields, illiquid assets, long-term investments, and resilient income for 2026.
Are US Treasuries Still A Safe Asset?
If you own treasuries, you need to make two separate decisions rather than one blended bet. The liquidity sleeve holds the bill exposure and does the work people mistakenly ask the long end to do. The duration sleeve stays deliberately small, sized as recession insurance rather than as a conviction call on falling inflation.
Pimco Embraces AI Boom on Its Own Terms
Pimco has been one of the loudest voices warning of risks in private debt markets, and Ivascyn, 56, has cautioned on the trillions of dollars pouring into the infrastructure underpinning the artificial intelligence boom.
Goldman, T. Rowe Debut Their First Interval Fund for the Masses
Goldman Sachs Group Inc. and T. Rowe Price Group Inc. are launching their first interval fund for the masses as Wall Street races to bring private investments to Main Street.
Old-Fashioned Bond Math for a New-Fashioned Fed
In the Warsh Fed's new era of two-way risk, bonds offer something rare: potential downside risk mitigation that investors get paid to hold.
Blackstone Debuts Funds to Bring Private Markets to Main Street
Blackstone Inc. leaned on Wellington Management Co. and Vanguard Group to create two new funds that will give individual investors access to private assets as it looks to go beyond its roots as a money manager for pensions and institutions to become more of a household name.
Rich Spreads, Cheap Treasuries, and an Incomplete Explanation
The relative cheapness of Treasuries versus interest rate swaps mechanically affects how corporate bond spreads are measured, but it appears to have limited influence on how corporate bond spreads actually behave.
Froth Coming Out. Tape Remains Resilient.
Chris Galipeau discusses high-conviction insights that go beyond media headlines.
U.S. Investors Looking for Global Fixed Income Exposure: Try Government Bonds, Selective Credit Picks
Government bonds are back in focus, as investors reassess where value lies in global fixed income. With markets wavering over how quickly interest rates will fall, sovereign debt in several developed economies is starting to look attractive again to us.
The Rise and Rise of Private Debt for Insurance Investors
Private debt is increasingly valued for its potential to help insurers operationally and strategically: support liability matching, improve portfolio design, diversify underlying exposures and, when underwritten well, add resilient excess return.
SaaSpocalypse Part II? IBM’s Preliminary Earnings Report Rattles Software
The Q2 earnings season is off to a rollercoaster start. The big banks collectively reported strong numbers, boosted by active capital markets and another impressive set of sales & trading revenue. And it was the usual chorus of bank CEO macro commentary:
Q3 Strategic Income Outlook: Perception Is Reality
Although economic conditions did not change much between the first and second quarters, investors were far more bullish in the second quarter.
Advisors Are Prioritizing Independence. Are Alternatives Platforms Doing the Same?
The universe of alternative investments is only growing. As advisors increasingly look for opportunities to diversify their client portfolios. But independent advisors who have purposefully built their businesses on doing what is best for their clients deserve to have partners who are doing the same.
BlackRock Crosses $15 Trillion With $192 Billion of Inflows
BlackRock Inc. pulled in $192 billion of net client cash in the second quarter, with investors pouring money into exchange-traded funds and pushing total assets above $15 trillion for the first time.
Pension Surplus Investing: Rethinking the Value of Overfunding
Historically, many in the pension industry viewed funding above the "plan termination level" as having little incremental value. Once a plan reached “plan termination level”, thought of as roughly 110% funding, conventional wisdom suggested additional surplus had little economic value because it is effectively "trapped capital."
Q2 Bank Earnings Preview: Hawkish Fed Pivot Eyed
The Fed's recent shift into a more hawkish mode creates concern about banking profits later this year, but second-quarter results are seen strong thanks to IPOs, mergers.
A Deeper Blind Spot in Private Credit: Why Asset Owners Need Borrower-Level Insight
To close the visibility gap, analysis must begin with the “borrower model,” not the fund. Once you know the types of businesses in a portfolio, their industry, revenue band, and geography, you can evaluate them against a statistically robust universe of similarly situated companies.
Spotting Market Bubbles: Why History Says It’s Nearly Impossible
If you knew you were standing inside a stock market bubble, you wouldn’t be standing in it for long. You’d sell. So would I, and so would everyone reading this. And if spotting market bubbles was something everyone could do in real time, the bubble couldn’t form in the first place.
Governments Must Fix Their Debt Messes Before It's Too Late
Almost two decades ago, when trillions of dollars in private housing debt proved unsustainable, governments had to step in to prevent the worst financial crisis since the Great Depression from eclipsing it.
Who’s Right? Two-Year Yields or Two-Year Breakeven Rates?
Chris Galipeau discusses high-conviction insights that go beyond media headlines.
A Growing Divide in Leveraged Finance
Higher rates, weaker underwriting, and software concentration are exposing vulnerabilities in direct lending and leveraged loans, while high yield bonds appear better positioned.
The World Didn’t Break: 2026 Mid-Year Investment Outlook
Midway through 2026, Franklin Templeton Institute’s Global Investment Outlook framework remains a valuable lens—but the landscape has shifted.
Tuning Out the Noise
AI-related disruption, asset valuations and borrower stress have put private credit under a microscope lately. Is this a market facing its first major test after a decade of rapid growth? If it is, we expect it to pass comfortably.
Global Investment Outlook—Resilience
A look at the resilient global economy, evolving market opportunities, and key risks shaping the investment outlook.
BlackRock’s Tseng to Exit as CEO of Troubled Private Credit Fund
The head of BlackRock Inc.’s beleaguered private credit fund is in the process of leaving the firm, a move that follows months of losses on soured loans and revelations of a US regulatory probe into the unit’s valuation practices.
AI’s Trillion-Dollar Debt Binge Fuels Century-Old Private Market
A private bond market dating back more than a century is opening a new front in the trillion-dollar AI funding boom, allowing tech borrowers to sell debt directly to deep-pocketed insurance firms.
As the Playing Field Expands, Insurance Investors Must Stay Nimble
Insurance investors face a broader opportunity set than ever across public and private credit—from corporate lending to asset-based finance. But those investments come in many forms. In our view, a all-encompassing approach can better assess relative value, pivot to new avenues and align investments with portfolio, liability and regulatory considerations.
Rotation Nation. Large-Cap Growth on Sale.
Chris Galipeau discusses high-conviction insights that go beyond media headlines.
The Credit Market Lens: What BDC Redemptions and NAV Pressures Mean for Investors
A widening confidence gap in non-traded investment vehicles is testing private credit valuations, sharpening the case for manager selection and diversification beyond direct lending.
Fed Conundrum: Are Rates Restrictive?
From our experience participating in Fed meetings, we know that the dot plot has never been universally embraced within the institution. The concern was not that it lacked informational value, but rather that markets interpreted it as a forecast, which was never its intended purpose. Forward guidance is meant to shape expectations and influence behavior, not to serve as a firm prediction of future policy decisions.
Private Credit, Explained
Private credit is having a moment in the headlines. Higher interest rates and a pullback in certain types of bank lending have pushed more financing activity into private markets. Investors may be left with a simple question: What exactly is private credit?
Gold, Fort Knox, and the Dollar’s Future
According to Gleason, the freezing of Russian assets following the 2022 invasion of Ukraine accelerated the global push toward de-dollarization. Nations around the world took notice that access to the dollar-based financial system could be restricted, increasing the appeal of gold as a reserve asset that cannot be frozen or sanctioned by foreign governments.
Meet the New Boss. Different from the Old Boss.
Chris Galipeau discusses high-conviction insights that go beyond media headlines.
The Case for US Industrial Development
The convergence of long-term structural drivers and emerging cyclical tailwinds suggests the industrial sector may be approaching an inflection point, with conditions increasingly supportive of new development.
Private Markets in Retirement Plans: Unlocking Opportunities
In August 2025, the US President Donald Trump signed an executive order aimed at broadening the investments available in defined contribution plans (DC plans). On March 30, 2026, the US Department of Labor issued proposed guidance regarding a plan fiduciary’s selection of investments, including private market and other alternative investments, in 401(k) plans.
How Fixed-Income Investing Is Evolving for European Insurers
For insurers, fixed income remains the foundation of portfolio strategy. But while public markets have long provided unrivaled sourcing capacity and liquidity, the definition of “core” is widening.
How Large Is Private Credit’s Total Addressable Market, Really?
One of the most debated topics in private credit is the size of the investment opportunity – or, in industry parlance, the total addressable market (TAM). But the way TAM is typically framed can be misleading.
Buyable Pullbacks. Be Prepared.
Chris Galipeau discusses high-conviction insights that go beyond media headlines.
Private Credit Is Still a Hot Asset for Bond Investors Buying Debt
As shareholders rush to pull money from private credit funds over troubling questions about software exposure, opaque loan values and non-payments, some bond investors are doing the opposite: buying their debt.
Rupture and Resilience
For more than four decades, PIMCO’s Secular Forum has provided a disciplined framework for stepping back from short-term market noise to assess the structural forces that will shape the global economy and markets over the next five years. Yet rarely has this exercise been more consequential than it has recently.
Inflated ‘Private’ Ratings Are Masking Credit Risk, Columbia Study Says
Ratings that underpin a growing slice of the $1.8 trillion private-credit market, the hottest corner of Wall Street in recent years, are systematically understating investment risk, according to a new study by Columbia Business School researchers.
2026—The Year the Fed Pauses. Rates Range-Bound. Now What?
Chris Galipeau and Taylor Topoussis discuss high-conviction insights that go beyond media headlines.
DoubleLine, Oaktree Brace for Potential AI Pain
Credit heavyweights like DoubleLine Capital LP and Oaktree Capital Management are buying debt now that can perform well if the artificial intelligence boom turns into a credit bust.
QuantStreet May 2026 Letter: Consolidation
In light of all this, our own view is that markets remain well positioned to continue to rally over the medium term, though given their stratospheric rise of late, a bit of a pullback might be in order in the short term.
Private Credit’s Resurgent Redemptions Shatter Short-Lived Calm
The $1.8 trillion private credit industry is finding out that trying to shake investor angst about the market is more of a marathon than a sprint. Such is the nature of long-term lending — there are few quick answers to the concerns that the market became too concentrated on software assets, a sector that’s ripe for disruption by artificial intelligence.
Cliffwater Private Credit Fund Stung by 17% Redemption Requests
Cliffwater LLC’s flagship private credit fund capped redemptions at 5% in the second quarter after investors looked to pull about 17% of shares, in a sign of enduring pressure on the $1.8 trillion market.
2026 Mid-Year Outlook: U.S. Stocks and Economy
Learn what's in store for the remainder of 2026 and the challenges that lie ahead in our mid-year outlook for U.S. stocks and the economy.
FS KKR Sells $900 Million Bonds in Rare Junk-Rated BDC Deal
A private credit fund jointly managed by Future Standard and KKR & Co. sold $900 million of junk bonds on Monday, according to people familiar with the matter, in a rare high-yield offering by a publicly traded credit fund.
Blackstone Ties Up With Nippon Life on Private Credit Investment
Blackstone Inc. has entered an agreement to provide Nippon Life Insurance Co. with investment services, adding to an increasing number of tie-ups between private investment firms and Japanese insurers.
What Are Investors Really Getting from Private Markets?
Private markets have become integral to modern portfolios, with many investors searching for higher returns and diversification, including from public markets. But recent fund redemptions have reinforced that illiquidity isn’t theoretical, raising questions about the benefits of giving up liquidity. We see several—but investors must understand the trade-offs.
Strong Earnings Season Complete! Where Will the Market Focus Now?
Taylor Topoussis and Chris Galipeau discuss high-conviction insights that go beyond media headlines.
The Retirement Hack Hiding Inside Most DC Plans
Many debates in defined contribution (DC) circles focus on fees, new asset classes, and ever more complex solutions. But the biggest improvement available to plan participants may come from something far simpler: how their fixed income is managed.
The Ellison Family’s $49 Billion Ask Is an Acid Test for Markets
Bankers are preparing to sell a jumbo debt package to support the $110 billion acquisition of Warner Bros. Discovery Inc. It’s a risky deal and comes at a moment when the bond markets have been wobbling.
Fundamental Backdrop Strong. Watch for Pullbacks.
Chris Galipeau discusses high-conviction insights that go beyond media headlines.
The Case for Active Management in the Private Credit Market
Private credit is more inherently complex than the traditional bond market. In comparison, private credit information comes at a deficit. That’s because private credit loans are essentially bespoke agreements between a lender and a private borrower.
Measuring What Matters in Public and Private Fixed Income
Despite the move lower late last week, U.S. Treasury yields are still holding well above recent lows and close to highs not seen in more than a year. By contrast, risk assets are firmly bid: U.S. equities have been routinely touching new historical highs, and credit spreads over Treasuries remain tight.
Bank Deregulation Taking Shape
This week marked the passing of former Massachusetts Congressman Barney Frank. His signature legislation, the Dodd-Frank Act of 2010, was the most recent increment in a long-running history of tighter financial regulation. Some of those rules are now coming under scrutiny, with the goal of making bank lending more competitive.
Real Assets or Active ETFs? Where RIAs Allocate
New AdvizorPro data shows RIAs broadened their ETF lineups in Q1 2026, leaning into real assets, active managers, and defense strategies.
The Cost of Being Too Liquid
Private markets (private equity, private credit and real estate) have historically delivered an “illiquidity premium”. Institutions and family offices have recognized this illiquidity premium and have historically allocated significant capital to capture it.
Key Convictions: Second Quarter 2026
In this second quarter update, Western Asset believes global fixed-income markets face a more complex backdrop as geopolitics, rapid AI adoption and private credit scrutiny intersect.
NAV Loans: Flexibility for Private Equity When Holding Periods Extend
For private equity firms, capital flexibility is prized today. Merger-and-acquisition (M&A) activity has cooled, while commodity prices and artificial intelligence (AI)-driven disruption have heated up, creating uncertainty for investors. This makes it more challenging to sell portfolio companies, so private equity firms are holding investments longer. As a result, many firms are turning to net asset value (NAV) loans for capital needs.
Private Credit’s Unthinkable Becomes Reality as Trading Revs Up
Private credit managers are increasingly turning to the once-unthinkable: Trading in and out of loans to dump troubled assets and hunt for bargains amid the industry’s first stress test after years of breakneck growth.
A Simple Way to Avoid Messes Like the Anthropic Shares Shock
Even if armchair investors are fleeing private credit or panicking that their unlisted shares in Anthropic PBC are now invalid, the long-term trend is clear: Public markets keep losing ground to private funds.
What Barbarians Like to Take Private
While most institutional investors recognize that private equity and public equity share similar economic risks, they often seem to ignore how their aggregate equity portfolio is affected by their substantial allocation to private equity.
Dispersion Revisited
Although a lot has changed since our last quarterly, its central theme – dispersion – feels like it’s only become more pronounced. We wrote last time that ‘‘we believe we’re entering a new era of dispersion in the performance of financial assets.’’
Texas Fund Revealed as Big Backer of State Street Credit ETF
The Texas Permanent School Fund bought more than 29 million shares totaling about $740 million worth of the State Street IG Public & Private Credit ETF, trading under the ticker PRIV, in the first quarter, according to a filing Friday.
From the US Market Desk: Now What?
Chris Galipeau discusses high-conviction insights that go beyond media headlines.
Why the 60/40 Portfolio Needs a New Playbook
As inflation lingers and market dynamics shift, advisors are rethinking the 60/40 portfolio with managed futures and options income ETFs.
A Proposal to Save Private Credit (Sort Of)
The sooner the mass of retail private credit managers realize they are zombies and give up the ghost, the sooner we can burn the whole thing to the ground and conjure a better model from the ashes. But there is no time like a crisis to have conversations about how to make the structure work better for everyone in the future!
Gamma And Momentum: A Recipe for Moonshots & Tears
Semiconductor stocks, along with some computer hardware companies, are the market’s latest AI darlings. Momentum and gamma are driving the outperformance, and, in their wake, a supportive narrative is trying to justify it.
On the Horizon: America’s Municipal Default Crisis
You are undoubtedly seeing in the news that high earners are leaving New York, Los Angeles, and other metro areas. This does not begin to address the magnitude of the problem. There are dozens of cities that are trending towards fiscal collapse. Indeed, taxpayers are leaving.
The Fed Sees Dissents Amid a Fluctuating Economy
What were the key takeaways from last month’s numbers? Our corporate bond specialists look back at the market’s performance and provide incisive commentary to help you make sense of what drove the market—and what may be on the horizon for fixed income investors.
‘Quiet Defaults’ Are Driving a More Compelling Backdrop for Opportunistic Credit
Stock markets have been hitting all-time highs and credit spreads remain low, yet higher interest rates and mounting floating-rate debt are straining lower-rated borrowers. This tension is surfacing first in leveraged loans as “quiet defaults” become more common — opening up a dynamic set of opportunities for investors specialized in stressed and distressed assets.