Private credit woes continue!

Investors continue to worry about the private credit market and this week has been filled with troubling news from the sector. According to the Financial Times, Glendon Capital Management said private credit funds run by Blue Owl (OWL) and several of its peers may have understated loss rates in their portfolios, suggesting actual losses could be higher than reported. This has led to concerns around the “true valuation” of these assets. This wouldn’t be surprising given the little clarity that we have for these loans. We also saw JPMorgan Chase take a conservative approach and mark down the value of some…

Prediction markets are hitting college campuses to find gamblers

Prediction markets have something FanDuel and DraftKings don’t, access to the 18 to 21-year-olds in college. Gambling is generally limited to adults 21 years or older, however, prediction markets that are run by companies like Polymarket and Kalshi are trades that are regulated as financial derivative contracts by the Commodity Future Trading Commission. This allows anyone 18 years or older to gamble using these prediction markets. Both Kalshi and Polymarket are hitting college campuses across the country and throwing cash around to lure in 18 to 21-year-old students to place bets via the prediction market. They are…

Don’t pay attention to the price of oil on a daily basis

I say that because there’s so much speculation out there and likely the information you receive on the price of oil is useless when you look forward to a few months and maybe even just a few weeks from now. Last week the price of oil surged around 35%, but on Monday after comments from the President that this will not last long in the Middle East, crude oil fell back down to under $85 a barrel. Why is this volatility in the price of oil happening? Roughly 20% of global oil consumption is exported through the Strait of Hormuz and about 20% liquefied natural gas exports worldwide also pass through the narrow waterway. The United States over the years along with other allies have spent billions of dollars making sure…

The International Energy Agency (IEA) agrees to historic oil release

The IEA, which is an organization of 32 member countries primarily with advanced economies in Europe, North America and northeast Asia, agreed to release 400 million barrels of oil from strategic reserves. Currently, IEA members hold more than 1.2 billion barrels of public emergency oil stocks, with a further 600 million barrels of industry stocks held under government obligation. While the strategic release is helpful, it is only a temporary fix considering nearly 20 million barrels passes through the Strait of Hormuz per day in normal times. China also could help with oil prices if it reduced its purchasing or released some of its stockpile. Ahead of the war China was…

Surprise.... Gen Z is going to the mall for in-person shopping!

You may be hearing that younger people don’t go to the mall any longer, but that is not true, it’s just a little bit different than when people went 20 years ago. Gen Z, the generation consisting of 14 to 29-year-olds, shops at the mall but first they check online sources like Instagram and TikTok to see what's in style. According to Nielsen IQ, the global annual retail spending by this generation is expected to be over $12 trillion by 2030. Shoppers between 18 and 24 years old made 62% of their general merchandise purchases in stores last year, but shoppers 25 and older made just 52% of their purchases in person. Some of the reasons given for the in-person preference was that Gen Z does not like to pay the shipping fees along with common sense things like they want to touch the item and see it in person especially if it’s clothing, they want to see how it looks on them. Malls understand this, and…

Companies Discussed: The Gap, Inc. (GAP), StubHub Holdings, Inc. (STUB), Delta Air Lines, Inc. (DAL) & Uber Technologies, Inc. (UBER)