Corporate debt in general is currently in a stable position, and private credit, despite recent growth, does not constitute a systemic risk at its current level.

“NO, CORPORATE DEBT IN GENERAL IS IN GOOD SHAPE. YOU TAKE PRIVATE CREDIT, LEVERAGE LENDING, $1.7 TRILLION. BANKS, $1.7 TRILLION. HIGH-YIELD MARKET, $1.7 TRILLION. I WOULDN'T PUT THAT INTO SYSTEMIC CATEGORY, EVEN IF IT GETS WORSE THAN PEOPLE EXPECT.”

Private credit poses risks to the broader market because liquidity in these assets can dry up, exposing leverage during economic downturns.

“The real mark started happening when liquidity starts drying up and it exposes the leverage. When liquidity dries up no good asset goes unleveraged.”