Weekly Market Commentary - Delayed 3-23-2026

“Private Credit Under Pressure”
See what we have to say about the following:

 

 

 

• Private Credit Under Pressure / What Is Private Credit: Private credit—especially direct lending—is under strain as higher rates, AI-driven disruption, and weakening borrower fundamentals expose liquidity mismatches from loans underwritten during the 2020–2021 low-rate cycle.

 

• Private Credit vs. Public Credit Markets (Size & Structure Graph): Private credit has grown larger than public credit markets, but expanded retail access through BDCs and ETFs introduces opacity, leverage, and liquidity risks that differ materially from traditional public-market credit.

 

• Cracks in the Core & Redemptions Meet Reality (Sector and Liquidity Graphs): Concentrated exposure to enterprise software and rising redemptions have stress-tested private credit vehicles, highlighting the tension between illiquid assets and semi-liquid structures while gating mechanisms limit systemic fallout.

 

• STAAC Commentary / Asset Allocation Insights: STAAC remains tactically neutral on equities, favors selective sector and style tilts, and maintains a neutral fixed-income stance with a preference for agency MBS, viewing recent volatility as a potential opportunity rather than a reason to de-risk.