'Greed Is Laid Bare': Hedge Fund Manager Reveals The Dark Side Of The Private Credit Crisis

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Boaz Weinstein runs Saba Capital Management, a $5 billion hedge fund best known for picking fights with closed-end fund managers. Now he’s picking a bigger one. He’s tendering to buy shares in Blue ...

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Tactical Dividend Income A Mdis SGD-H Plus","JPMO":"JPM期权收益策略ETF-YieldMax","BK4581":"高盛持仓"},"translate_title":"“贪婪暴露无遗”：对冲基金经理揭示私人信贷危机的阴暗面","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"OWL":1,"JPMO":0.6,"FSK":1,"BX":1},"content_text":"Boaz Weinstein runs Saba Capital Management, a $5 billion hedge fund best known for picking fights with closed-end fund managers. \nNow he’s picking a bigger one. \nHe’s tendering to buy shares in Blue Owl Capital Inc’s (NYSE:OWL) private credit BDC at 65 cents on the dollar.\nBlue Owl’s retail investors have been trying to cash out of the fund, but redemption requests are piling up faster than the fund can pay. \nWeinstein is stepping in with a lowball bid, betting that some investors would rather take 65 cents now than wait years in a queue.\nWeinstein’s argument on Bloomberg’s Money Stuff podcast was blunt. \nRetail investors were promised they could pull 5% of their money per quarter from these funds. That promise, he said, is “fire insurance that doesn’t work if there’s actually a fire.”\nThe fire is here. Cliffwater’s fund saw redemption requests spike from 4% to 14% in one quarter. \nBlackstone Inc’s (NYSE:BX) flagship BCRED reported 7.9% this quarter. Starwood’s REIT has been gated for nearly four years. Investors want out and there’s no exit.\nWeinstein says he’s offering one. Buy the shares at a discount, give trapped investors cash, and bet that the underlying portfolio is worth more than 65. \nPrivate credit funds mark their own portfolios, and Weinstein says everyone knows the NAVs are too high. \nJPMorgan Chase (NYSE:JPM)recently marked its book down hard while others haven’t followed, and the gap between how different banks price the same loans can be 25 points wide.\nThat matters because fees are calculated on NAV, so higher marks mean bigger paychecks for the manager. \nWeinstein pointed to FS KKR Capital Corp (NYSE:FSK), recently trading at a 50% discount to book, where an analyst asked why management kept making new loans at 12% instead of buying back its own stock at half price. \nIf the NAV is real, that’s a guaranteed 100% return. \n“Greed is laid bare,” Weinstein said.\nThe cracks started when distribution cuts hit. \nRetail investors had been collecting roughly 1% a month like clockwork, and when payouts were trimmed, the redemption wave began.\nThe worry is that this doesn’t stay contained. \nWeinstein warned that falling NAVs force asset sales, which push NAVs lower, which trigger more redemptions. “I really think this could be a systemic nightmare,” he said. \nPrivate credit could “infect” public markets when investors who can’t sell illiquid positions start dumping what they can.\nPrediction markets are already pricing the spillover. \nKalshi’s 2026 U.S. recession contract hit 37%, up from under 21% days earlier in the month. Polymarket has it at 36%. \nWeinstein suggested someone set up a prediction market on Cliffwater’s private credit funds next quarter redemptions. None exists yet.\nImage: Shutterstock\nTo add Benzinga News as your preferred source on Google, click here.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0,"need_auth":false,"code":"91000000","status":"200"},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"tenantId":"TBGLOBAL","deviceId":"web-server-community-laohu8-v3","version":"4.36.2","shortVersion":"4.36.2","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2621755399","isCrawlerRequest":true}