Private Credit Is Already In Trouble — Now Wall Street Is Adding A 2008‑Style Twist
Credit default swaps (CDS) played a central role in the 2008 financial crisis, functioning as largely unregulated insurance on mortgage-backed securities (MBS). Today, major banks have begun trading CDS tied to private credit funds, raising concerns that similar risks may be building beneath the surface of the financial system.
JPMorgan (NYSE:JPM), and Barclays have begun trading credit default swaps linked to private credit funds run by Blackstone, Apollo Global, and Ares Management, The Financial Times reported.
At the same time, Morgan Stanley (NYSE:MS) and Citigroup (NYSE:C) are reportedly offering to trade contracts tied ...
Source: Benzinga