Pimco Squares Up for a Bareknuckle Fight in Private Credit
The fund giant says cracks in the booming asset class could appear as soon as this year, and it wants to step in if risk-averse investors have to sell out on the cheap.
Pacific Investment Management Co. has a history of making chunky contrarian bets going back to a money-spinning punt on cheap mortgage debt after the financial crisis.
Photographer: David Swanson/BloombergPacific Investment Management Co. has been one of the loudest prophets of doom on private credit in recent months. Now it’s saying cracks in the red-hot asset class could appear as early as this year — and that it’s poised to use roughhouse tactics more common to hedge funds to grab bargains.
The investment giant has a history of making chunky contrarian bets going back to a money-spinning punt on cheap mortgage debt after the financial crisis. If it turns out to be right as the Cassandra of private credit, this booming $1.7 trillion market is about to go through a grueling reality check.