Credit markets are experiencing cracks, indicating potential risks to the economy and global finances. Easy lending over the past decade has led to casualties, while some individuals thrive.
Investors should view these cracks as a “K-shaped” recovery, where only some people succeed, while others struggle. The Bank of England’s governor, Andrew Bailey, warned that the collapse of two US companies linked to private credit could signal deeper financial system vulnerabilities.
A boom in lending has created risks, and experts are cautious about potential economic downturns ahead.
Source: https://www.marketwatch.com/story/cracks-are-now-showing-up-in-credit-markets-heres-how-investors-should-view-them-4822fdf6