Why Everyone Is Freaking Out About Private Credit
What Next | Daily News and Analysis
Slate Podcasts
4.3 • 2.4K Ratings
🗓️ 3 April 2026
⏱️ 30 minutes
🧾️ Download transcript
Summary
In the wake of the 2008 financial crisis, private credit or “shadow banking” grew as an alternative to the regulations and shared risk that institutional banks operate within. What happens if a crisis hits the trillions of dollars that are outside of those guardrails? We may be about to find out.
Guest: Tracy Alloway, co-host of Bloomberg's Odd Lots podcast.
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Podcast production by Evan Campbell, and Patrick Fort.
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Transcript
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| 0:00.0 | My name is Tracy Allaway. I am the co-host of Bloomberg's |
| 0:08.0 | Odd Thoughts podcast. Tracy's been covering financial markets for a long time. I always |
| 0:15.6 | learn something from listening to her. Do you remember what you were doing in the late summer, early fall of 2008? |
| 0:26.5 | Of 2008? Oh my gosh. You know what? I had just switched jobs. I'd actually left Bloomberg at that time, |
| 0:33.5 | where I was covering airlines, of all things, in London, and I had joined the Financial Times, |
| 0:39.0 | just joined their finance and markets blog, which was called F.T. Alphaville, turned out to be |
| 0:44.7 | a phenomenal time to start covering finance and markets in sort of September 2008, because |
| 0:51.9 | not a single person at that time really seemed to understand what was going on. |
| 0:57.0 | So even though my background was actually in airlines and transportation and logistics, I was able to be on an even playing field with people who had been covering banking and finance for decades. |
| 1:09.3 | At the time, I worked for Bloomberg News covering economic policy in Washington, and I remember |
| 1:15.2 | the whispers that something was starting to go wrong in the mortgage market. |
| 1:19.9 | We all know what happened next, the financial crisis. |
| 1:24.0 | And now, some 18 years later, I'm hearing little conversations and worries about something called |
| 1:31.4 | the private credit market, a kind of financing that is very big in tech. |
| 1:37.2 | I think the vibes are actually very similar. And in fact, if we just look at this on a sort of |
| 1:43.0 | behavioral Wall Street basis, |
| 1:45.3 | like let's pretend to be anthropologists of the financial industry at the moment, some of the |
| 1:50.5 | behaviors you're seeing right now look very similar to what we saw in sort of 2007, 2008. |
| 1:57.5 | So you have some pretty big funds who are saying, we're not going to let investors |
| 2:01.7 | pull out their money. They're allowed to do that. But the headlines are very similar to what we |
| 2:06.8 | saw in, you know, 2007, 2008 with a few subprime funds back then. We're starting to see reports |
| 2:13.1 | of private credit lenders having these sort of all hands on deck phone calls where they're trying to reassure their employees. |
... |
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