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Separate private credit ‘signal from the noise’

admin — Tue, 14 Apr 2026 18:38:24 +0000

A version of this article appeared in CNBC’s Inside Alts newsletter, a guide to the fast-growing world of alternative investments, from private equity and private credit to hedge funds and venture capital. Sign up to receive future editions, straight to your inbox.

Fears of rising defaults and a systemic crisis from private credit don’t reflect the underlying fundamentals of private loan portfolios and returns, according to Blackstone’s head of private wealth.

A wave of redemptions is causing fresh concerns about the risks of private credit, with Ares Management, Apollo Global Management and others capping investor withdrawals from their funds last month. Joan Solotar, global head of Blackstone Private Wealth, which manages over $300 billion, said the capital flight isn’t justified by the likely returns and potential losses in individual funds.

“In my view, you’ve had all these calls that the house is on fire, when what we see is maybe a piece of burnt toast,” she said.

Solotar said investors and clients are asking important questions about transparency, loan losses, portfolio exposure to software and liquidity. She said some funds may see lower returns. Yet she said the broader case for private credit and access to private capital remains stronger than ever.

Some of worst-case scenarios published by Wall Street analysts, she said, call for loan defaults of up to 15%. Spread over three years, the loss of total annual return would be about 300 basis points. If credit spreads widen, she said the returns for private credit funds could fall to around 3% to 5%, down from the current 6% to 9% that is common for many funds.

“Is 3% to 5% return a disaster?” she said. “And what’s happening in the public equivalents? Because when I look at the public equivalents, they’re actually down. So we’re still outperforming, and that’s the key. I think it’s a matter of staying calm, understanding what you own, what the real downside is.”

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Of course, many bank CEOs, analysts and investors disagree, saying private equity firms are understating the potential risks and exposure. The most cited risk is software firms, which make up a large share of private credit lending and are now seen as vulnerable to disruption from artificial intelligence. The Wall Street Journal recently found that large private credit funds managed by Blackstone, Apollo, Ares and Blue Owl had more exposure to the software firms than their filings suggest.

Solotar said less than 5% of the assets in Blackstone funds are vulnerable to AI. While some investors and commentators have criticized the lack of transparency and disclosure in private credit funds, she said the funds often disclose more loan information than banks.

“The word ‘private’ only relates to the fact that these aren’t publicly traded,” she said. “But it doesn’t mean secret or shadowy. I was a financial institutions analyst for many years, and I will tell you the banks do not let you know how they’re carrying any of their loans. We actually show you at the single, individual loan level. There is so much transparency, and we report that every single quarter.”

Solotar likens the current period in private credit to real estate funds after the pandemic. In 2022, Blackstone limited withdrawals from its $60 billion flagship real estate fund as investors worried about the decline in commercial real estate. Over time, withdrawals stabilized, all redemptions were honored and the property market rebounded.

She said the current “stress test” in private credit will actually prove its value in portfolios over the longer term. Institutional investors have proven for years that private investments provide important balance in a portfolio, with less volatility, longer time horizons and often better long-term returns than publicly traded investments.

The private equity industry’s efforts to expand private credit and private assets into 401(k) plans has come under growing criticism, especially given the current redemptions. Former Goldman Sachs CEO Lloyd Blankfein recently told Bloomberg that putting alternative assets into the retirement portfolios of everyday investors was “crazy.”

“Why are you going into this dangerous territory just to make your business a little bit bigger when that represents such a big potential problem in the future?” Blankfein told Bloomberg. “These securities are opaque and may be riskier than most.”

Solotar said Blankfein’s comments highlighted the need for more education.

“I think everyone has to be very well educated on what they’re putting in the portfolios, how the structures work, the limits of liquidity, how they interact with other parts of the portfolio,” she said. “And I would ask Lloyd if he has private investments in his portfolio. I’m guessing the answer is yes.”

Solotar said the demand for private investments will only continue to grow as investors seek to mimic the returns and strategies of large institutions, like endowments, pension funds and sovereign wealth funds that have been allocating to alts for decades. Given the vastly larger size of private markets compared to public, the alts revolution is still in its early stages.

Blackstone Private Wealth’s $300 billion in assets today is up from $58 billion in 2017. Solotar said Blackstone aims to grow its AUM to $1 trillion in the coming years.

“I like to say we are not even in the first inning, I think we’re still in spring training,” she said. “When you think about how pension funds are allocated, about a third of their investments are in private. The top foundations and endowments are at similar levels, and the same with family offices. And if you look at retirement accounts, you’re less than 1% or close to zero. So I see this as a very long-term path of travel, with the same trends happening globally, and it is super early.”

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The post Separate private credit ‘signal from the noise’ appeared first on Our Story Insight.

Kevin Warsh soars ahead of Hassett in Polymarket, Kalshi odds on next Fed chair after Trump signal

admin — Fri, 16 Jan 2026 17:21:06 +0000

Former Federal Reserve Governor Kevin Warsh soared ahead of National Economic Council Director Kevin Hassett on prediction markets betting on the next Fed chair after President Trump on Friday hinted that Hassett might be out of the running.

Trump did not reveal his final choice to replace Fed Chairman Jerome Powell, but said he would like to keep Hassett in his current role.

“I see Kevin’s in the audience, and I just want to thank you. You were fantastic on television today,” the president said during remarks at the White House on Friday.

Former Federal Reserve Governor Kevin Warsh soared ahead in prediction markets betting on the next Fed chair Friday morning. Bloomberg via Getty Images

“I actually want to keep you where you are, if you want to know the truth.”

The odds of Warsh clinching the nomination jumped to 59% on Polymarket, while traders placed just a 15% chance that Hassett would land the job – following weeks in which markets placed better odds on Hassett.

Even current Fed Governor Christopher Waller, who has been considered a long shot, beat out the odds of a Hassett nomination with 15.6% on Polymarket. Traders also saw less than a 10% chance that BlackRock exec Rick Rieder could win the role.

Warsh also jumped to 59% odds on Kalshi, another prediction market. Hassett and Waller got 16% and 15% odds, respectively.

Trump has not set a specific date to name his pick for the next chairman. Powell’s term at the helm expires in May, though he could choose to stay on the board through 2028. He has so far declined to comment on whether he will remain a Fed governor.

On Sunday, Powell publicly shared that he’s under criminal investigation for allegedly lying during congressional testimony last summer — a stunning development that came after years of Trump blasting the chair for failing to lower interest rates quickly enough.

President Trump said Friday he would like to keep Kevin Hassett in his current role at the National Economic Council. AP

For weeks, the president has signaled he is looking at either Warsh or Hassett to replace Powell, adding that he has ruled out Treasury Secretary Scott Bessent “because he wants to stay where he is.”

Rieder and Waller have also been interviewed for the role.

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While Trump said he’d like to keep Hassett in his current job, it’s not impossible for him to win the nomination.

After Fed Governor Adriana Kugler unexpectedly resigned last summer, Trump tapped Stephen Miran, then a top White House economic adviser. Miran refused to fully resign from his White House role, instead taking an unpaid leave of absence.

Addressing White House Chief of Staff Susie Wiles on Friday, Trump said, “We don’t want to lose him [Hassett], Susie, but we’ll see how it all works out.”

The post Kevin Warsh soars ahead of Hassett in Polymarket, Kalshi odds on next Fed chair after Trump signal appeared first on Our Story Insight.

After the Signal Leak, How Well Do You Know Your Own Group Chats?

admin — Wed, 26 Mar 2025 06:59:58 +0000

Hey, are you sure you want to send that to your group chat? Like, one thousand percent sure?

Just checking. Because it’s been a strange week in the history of the group chat, those seemingly intimate text conversations that ping back and forth among friends and family members and, apparently, national security personnel.

On Monday, the editor in chief of The Atlantic, Jeffrey Goldberg, wrote that he had accidentally been added to a group chat on the encrypted messaging app Signal. He followed along as Defense Secretary Pete Hegseth laid out attack plans against Houthi strongholds in Yemen and watched other national security officials post celebratory emoji after the strikes had taken place.

As lawmakers on both sides of the aisle condemned the security breach, Americans with their own unruly group chats watched with recognition and disbelief: How had some of the country’s most powerful officials managed to so badly bungle using technology that millions of people rely on every day?

“Obviously it’s a very relatable screw-up,” Mr. Goldberg said during an interview with Tim Miller of The Bulwark on Tuesday. “We’ve all sent texts to the wrong people,” he added.

Those inadvertent texts, however, don’t typically contain high-stakes national security information that is being shared outside secure government channels.

The incident might be “the most shockingly stupid group chat error in history,” the liberal podcaster and former National Security Council spokesman Tommy Vietor said in a video on X. In the same post, he confessed that he had once been on an email thread that mistakenly included the singer Lyle Lovett instead of his colleague, Jon Lovett. About 30 emails had been sent before anyone noticed.

The group chat has quietly become a staple of modern communication since 2008, when Apple enabled text messaging with more than one recipient. Private group chats confer a kind of juicy intimacy on the book club members, neighborhood moms, work friends or extended family members who sometimes exchange hundreds of messages per day.

The feed tends to be less self-conscious than our posts on social media: In 2022, a guest essay in The New York Times declared the group chat “The Last Place Left Online for Real Conversation.”

Even those without a security clearance are careful about what they share in the comfortable familiarity of their group chats. Clayton Fletcher, 48, is part of a WhatsApp group where he and around 35 other comedians roast one another and work on new material. When a new phone number appears, he goes on high alert — something that did not seem to happen when Mr. Goldberg was added to the Signal chat.

“The wisdom of the ages for comedians is to know your audience,” Mr. Fletcher said. “I guess in the modern world, it’s like: Know who’s in your group chats.”

The intimacy of the group chat has often curdled once it spills into the public eye. In 2021, an anonymous leaker shared group messages from Heidi Cruz, the wife of Senator Ted Cruz, in which she planned a trip to Cancún while millions of the senator’s constituents were without electricity. (“Heidi Cruz Clearly Didn’t Understand That the Group Chat Knows No Loyalty,” a Jezebel headline read.)

In 2023, The New York Times published texts among Fox News hosts that were starkly different from their public statements about the 2020 election results. And last year, The Daily Beast reported that the former congressman George Santos had texted insults to a group chat containing members of the New York Republican delegation.

“Sorry new phone, who dis?” Representative Andrew Garbarino responded.

Our group chats span our professional and private lives and may include people with whom we have both strong and loose social connections. That can make them a “minefield” for errors, said L.M. Chilton, the author of the forthcoming thriller “Everyone in the Group Chat Dies.”

The Signal group chat incident was particularly jarring because of the colloquial, just-among-friends tone — emojis included — that it used to discuss to deadly military airstrikes, he added. And while it might be easy to blame technology for the breach, it was the mistake of the national security adviser Michael Waltz that made the group chat accessible to a journalist.

“At the end of the day, it’s human error, and that’s been with us since the dawn of time,” Mr. Chilton said.

Matt Buechele, 35, a writer in New York, found a bit of dark humor in the way the Signal group’s members had introduced themselves one by one, the way he had seen participants do before in countless group chats for bachelor parties.

Everyone has been added to a group chat in which they don’t quite belong. But he suggested keeping a low profile unless you are absolutely sure you can trust the group’s other members.

“If you see a bunch of numbers you don’t know, you have to limit your group chat participation to thumbs-up reactions and ‘haha’ reactions — nothing else,” he said.

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