Why Credit Conditions Have Actually Eased Over Past Year | Oaktree’s Wayne Dahl on High-Yield Bonds, Leveraged Loans, Private Credit, and the Recession Yet To Arrive

Why Credit Conditions Have Actually Eased Over Past Year | Oaktree’s Wayne Dahl on High-Yield Bonds, Leveraged Loans, Private Credit, and the Recession Yet To Arrive – Forward Guidance

Bullish:

$HIGH YIELD BONDS - High yield bonds are seen as attractive due to favorable yields, low defaults, and increased quality at the higher end of the market.
$STRUCTURED CREDIT - Structured credit market is seen as having relatively attractive pricing.
$NONAGENCY RMBS - Nonagency RMBS is considered a pretty attractive place right now.
$DATA CENTERS - Data centers in commercial real estate are growing and need financing.
$ASSET BACKED SECURITIES - Asset backed securities may benefit from the fiber being put into data centers.
$POWER GENERATION COMPANIES - Companies focused on power generation are needed for data centers.
$PRIVATE CREDIT - Private credit has provided good excess return and has been a solution to challenging issuers in the loan market.

Bearish:

$SPECIALTY RETAIL - Specialty retail is seen as an area with a greater chance of volatility due to its tie to discretionary spending.
$OFFICE SPACE IN COMMERCIAL REAL ESTATE - Office space in commercial real estate is under stress and has not done well.