For the first time in this cycle, the money going out of major private credit vehicles has surpassed the money coming in. That is the headline, how private credit machine is now facing sustained investor outflows. Stage 2. And here’s the other big part of that – these net outflows are indeed forcing asset sales onto an industry that was never really built for this. That means we’re already deeper into Stage 2 than most people would think. Eurodollar University&#x27;s Money &amp; Macro Analysis -------------------------------------------------------------------------------- Learn more about Augusta Precious Metals and what they have to offer - including physical gold for IRA accounts - by going to: https://EurodollarGold.com or text EURO to 35052. -------------------------------------------------------------------------------- Private Credit BDC Redemptions Exceed Fundraising for First Time https://www.bloomberg.com/news/articles/2026-05-14/private-credit-bdc-redemptions-exceed-fundraising-for-first-time Private Credit’s Unthinkable Becomes Reality as Trading Revs Up https://www.bloomberg.com/news/articles/2026-05-21/private-credit-s-unthinkable-becomes-reality-as-trading-revs-up Fitch Ratings’ U.S. Private Credit Default Rate Hits a High of 6.0% in April 2026 https://www.fitchratings.com/research/corporate-finance/fitch-ratings-us-private-credit-default-rate-hits-high-of-6-0-in-april-2026-18-05-2026?cs=0&amp;hl=en-US&amp;biw=1600&amp;bih=731 Private Credit Fund Touts Quick Profit Buying Debt at 65 Cents https://www.bloomberg.com/news/articles/2026-05-05/private-credit-fund-touts-quick-profit-buying-debt-at-65-cents Goldman Sachs Private Credit Fund’s Share of Bad Loans Rises https://www.bloomberg.com/news/articles/2026-05-07/goldman-sachs-private-credit-fund-s-share-of-bad-loans-increases HSBC Drags Feet on $4 Billion Private Credit Investment Effort https://www.bloomberg.com/news/articles/2026-05-15/hsbc-drags-feet-on-4-billion-private-credit-investment-effort AMP Trims ‘Frothy’ Private Credit Assets in Investment Pivot https://www.bloomberg.com/news/articles/2026-05-18/amp-trims-frothy-private-credit-assets-in-investment-pivot https://www.eurodollar.university Twitter: https://twitter.com/JeffSnider_EDU

Goldman Sachs Just Confirmed the Worst-Case Scenario

Eurodollar University

# Full Transcript

**Podcast:** Eurodollar University

## Participants

- **Jeff Snider** (Eurodollar University)

## Transcript

For the first time in this cycle, the amount of money that's coming out of private credit vehicles surpassed the money that's still coming in. That's the headline, not some bad loan or troubled borrower or some valuation question here or there. It's about a private credit machine that is facing sustained investor withdrawals for the first time. Stage two. But here's the other part of that. It is indeed forcing asset sales on an industry that was never built for this.

We are deeper into stage two than most people think. Private credit was built on a very simple assumption. The money keeps coming in. That was the whole pitch. Reach for yield goes on reaching forever into the future. But now that flow has flipped. If investors are pulling out more money than new investors are putting in, fund has to find cash somewhere. It can use existing cash. It can slow down new lending. It can borrow. It could borrow. It can wait and hope redemptions calm down.

But we've already seen the borrowing tighten up and that has continued with collateral revaluations. And so more and more funds are being sucked up into the trap. And that's where the entire private credit story changes. Because once the funds have to sell assets, private credit stops being this magical, stable, mark-to-model world. It becomes something more dangerous. A market on the downside. And those markets, they have prices.

Sometimes those prices are not 98 cents on the dollar. Sometimes they're not even 90. In one recent Bloomberg story we'll go over, one fund was reported buying debt at around 65 cents on the dollar. 65 cents. That's not low volatility and stable NAVs. That's not hold to maturity. It is stage two. It is stage two price discovery. The very thing the industry has been trying to avoid this entire time.

So we've got a lot of new developments to go through, including stuff on Goldman Sachs, seeing more losses. What Fitch has to say about those losses, about the industry as a whole, plus HSBC and a firm down under that are dragging their feet in private credit. And all of it fits within this overall context. Deeper into stage two. Outflows outpacing. Inflows for the first time. Forced selling. Banks holding back. Different stories. Same direction.

The private credit cycle is moving from hidden stress to more visible pressure. As the guy Tarman from Deutsche Bank said, if it wasn't for the Iran conflict, this would be all over the front pages, as is now the pressure that's forcing sales. Now, the most important update that we're going to start with to report that redemptions from private credit BDCs have exceeded fundraising for the first time. Quote, non-traded private credit funds handed more money back to investors than they raised in the first quarter.

The first time outflows from the vehicles have surpassed inflows. Non-listed business development...

Goldman Sachs Just Confirmed the Worst-Case Scenario

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Goldman Sachs Just Confirmed the Worst-Case Scenario

Transcript

Built for investment professionals

Every day you wait, your competitors are findingedge in conversations you're not hearing.

Every day you wait, your competitors are finding
edge in conversations you're not hearing.