America’s private credit boom is turning into a game of musical chairs—and that’s a worry
Private credit grew in the 2008 financial crisis’s aftermath, when regulators moved to get riskier lending off bank balance sheets and into the hands of long-term, real-money investors capable of absorbing losses during credit crunches. Until recently, only sophisticated institutions and ultra-wealthy investors could access private credit funds—a largely hidden corner of finance where non-bank lenders raised money to make loans to mid-size companies, away from the scrutiny of public markets.
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