On the program today, a vote for making finance boring again.

We'll do some commodities and then wine.

From American public media.

This is Marketplace. In Los Angeles, I'm Kyle Rizdahl. It is Tuesday. Today, the 24th day of March. Good as always to have you along, everybody.

We're going to begin today, not with the war, not with equities, not with oil or supply chains,

but with a slice of the financial markets that is beginning to become just a little bit unglued.

Ever since the financial crisis going on 20 years ago now, if you can believe that,

investors have been pouring money into what's known as private credit, nearly $2 trillion worth, money that gets loaned out to businesses that were unlikely, shall we say, to be able to get loans from actual banks.

Those investors, though, have been getting jittery, worried by some high-profile the faults and the future prospects of, you know, getting their money back.

So a lot of them

have started pulling money out of private credit. Bank run is a little bit strong here, but

not by much. Marketplace's Henry Epkitt gets us going. Private credit has gotten as big as it has

because of the financial crisis. Banks had lost a lot of money on loans, and Washington

had imposed new lending regulations, says Kent Belasco at Marquette University. That caused banks

to become, you know, much more risk-averse. And so therefore, it became a little harder to get credit.

Especially for mid-sized companies.

At the same time, investors were looking to put their money into funds that got a decent yield.

Says Amir Sufi, a professor of finance at Chicago Booth.

Private credit gave them that.

From about 2010 to about 2024, the returns on private credit were truly impressive.

Eight to 10 percent, Sufi says, and the borrowers didn't default much.

But the good vibes have changed lately.

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