A few things of note on this Monday morning

With the extraordinary amount of money piling into private credit (I get countless deal offerings emailed to me on a daily basis) I continue to have my eye on the LSTA Leveraged loan index as a marker on pricing. As private credit is essentially just a loan that used to be made by a bank (and indirectly still is if a bank is lending money to a private credit firm to underwrite loans) but instead resides in the non financial center, it's still subject to the same economic vagaries that should garner greater scrutiny when economic concerns grow. Keep in mind, for every low double digit return advertised by private credit is a borrower having to pay low double digits for that loan or something close if a bit of leverage is used to lift returns.

LSTA Leveraged Loan Index

With the US bombing the Houthi's in an attempt to finally destroy their strangle hold on the Red Sea, here was an update from last week's World Container Index. The Shanghai to Rotterdam route fell in price to the lowest level since late December 2023 at $2,512 for a 40 foot container. The Shanghai to LA trip is down to $2,906, the cheapest since early January. So, for the following weeks/quarters, either we've destroyed their capabilities or this situation gets more messy.