Re:PPCC: Pisitófilos Creditófagos. Otoño 2025

[tomasjos]

El problema de la vivienda no son las hipotecas | Opinión | Cinco Días https://share.google/OzJgGLgPRO27ImSbc

[Derby]

https://www.ft.com/content/6ef2d803-0117-44e0-8f99-947459b55c62

If private credit breaks, insurers will fall under the microscope

Rising holdings of the asset class could lead to problems when the next downturn comes


A Moody’s report estimates bank exposure to private credit funds was $525bn at the end of 2023 © Chris Ratcliffe/Bloomberg

Private markets have been attracting increasing regulatory scrutiny, and for good reason.

It’s not just that the level of disclosures is less than what is required in public markets. Or even that valuations of private market assets are more based on models rather than public pricing, robbing regulators of market signals that could inform their work. It’s because private markets have become so big.

By value, global private assets under management came to just over $13tn in 2023, having more than doubled in size over the previous five years, according to a recent report by financial data firm Preqin. It estimated that this figure is on track to almost double again by 2030. The vast majority of these holdings are private equity assets, though the growth of private credit has been explosive. To put these numbers into perspective, Boston Consulting Group estimates that the total assets under management in the global asset management industry for 2023 totalled $115tn.

But while the lack of data transparency makes it hard to say anything with confidence, it’s not obvious that this growth poses immediate direct risks to the banking system. Good data as to how much banks lend to private market entities in general, or even private credit firms specifically, is scarce. However, the IMF’s Global Financial Stability Report from April 2025 highlighted a Moody’s report that estimated bank exposure to private credit funds was $525bn at the end of 2023.

That $525bn sounds a lot. But global banks are huge. As Moody’s puts it, exposures are moderate with private credit loan commitments about 3.8 per cent of total loans on average in 2023. So sure, private credit managers could start making terrible loans that default but this scenario doesn’t look like it would immediately blow up the banking system — although the use of “synthetic risk transfers” which enable banks to transfer credit risk on diverse loan pools to investors (typically credit funds and asset managers) may complicate the picture.



If there is a problem, it looks more likely to crop up in the insurance sector. Private credit now accounts for more than 35 per cent of total US insurer investments and close to a quarter of UK insurer assets.

Private equity-owned insurers in particular have proved effective at improving capital efficiency — taking more risk with each dollar of capital. This could come through some combination of regulation-shopping the jurisdiction of their reinsurance operations, lending to affiliates, or engaging in wholly-owned portfolio securitisation.

It could also come from building out investment operations so they can take more substantial exposure to private credit — which can offer substantial illiquidity premia, the additional return that can come when taking on the risk of holding an asset that is not easily sold.

How risky is this? Well, the private credit holdings of insurers overwhelmingly carry investment grade credit ratings — signalling exceptionally low prospective default risk. However, it is an open question whether ratings by different credit rating agencies all deserve equal trust — especially those ratings that are issued privately without public disclosure. Colm Kelleher, chair of UBS, has accused insurers of ratings shopping, calling the phenomenon “a looming systemic risk”.

Moreover, a recent analysis from Moody’s shows that while a ninth of US life insurers’ fixed income holdings by value carry private ratings, this share jumps to more than half of their so-called Level 3 holdings. Level 3 holdings are assets that are the least liquid, hardest to value and priced using models that rely on internal assumptions. And, according to the credit rating agency, US insurers’ less-liquid private asset portfolio was skewed to lower-rated holdings at year-end 2024.

Recent high-profile company failures like First Brands and Tricolor — characterised as credit cockroaches by Jamie Dimon — provide a warning of the potential downside. The JPMorgan chief executive quipped that if you see one cockroach, there are probably more.

But given the wave of new money that has moved into loans and bonds, borrowers have been able to raise finance in both public and private markets at attractive rates. Default rates have been low — even taking into account that some financially stretched businesses have found private lenders willing to restructure their credit into cash-lite payment-in-kind loans.

Market prices suggest that there is little prospect of an economic downturn sufficient to impede debtors’ timely payment of principal and capital any time in the foreseeable future. If correct, insurers will continue to profit from their greater capital efficiency. So will ordinary people. Increased competition has pushed insurers to offer better terms for those seeking fixed or variable rate annuities for retirement income.

So tilting the scales away from resilience and towards profitability could prove to have been exactly the right thing to do for insurers. But we’ll have to see how they fare in the next credit downturn to find out.

[Derby]

https://www.ft.com/content/583e9391-bdd0-433e-91e0-b1b93038d51e

Oracle hit hard in Wall Street’s tech sell-off over its huge AI bet

Larry Ellison’s software company falls more than rivals over its borrowing and reliance on OpenAI contracts


The software group founded by Larry Ellison, pictured, had committed to spending hundreds of billions of dollars in the next few years on chips and data centres © FT montage/Bloomberg/Getty Images

Oracle has been hit harder than big tech rivals in the recent sell-off of tech stocks and bonds, as its vast borrowing to fund a pivot to artificial intelligence unnerved Wall Street.

The US software group founded by Larry Ellison has made a dramatic entrance to the AI race, committing to spend hundreds of billions of dollars in the next few years on chips and data centres — largely as part of deals to supply computing capacity to OpenAI, the maker of ChatGPT.

The speed and scale of its moves have unsettled some investors at a time when markets are keenly focused on the spending of so-called hyperscalers — big tech companies building vast data centres.

Oracle shares are down 25 per cent in the past month, nearly twice the fall of the next worst-performing hyperscaler, Meta.

The slide has reversed more than $250bn of gains in its market value when the Texas-based group disclosed its deals with OpenAI in September. A Financial Times index tracking the price of Oracle’s debt has fallen about 6 per cent since mid-September, significantly worse than any of its major peers.

Oracle has prompted particular concern because the group shifted from business software to cloud computing later than its rivals. Its strategy has become more focused on an all-out bet on AI, pinned largely to the success of OpenAI.

“This is a completely different business model to what investors prize in cloud services,” said Alex Haissl at Rothschild & Co Redburn. “The deals look fantastic when you look at the revenue figures, but they are very capital intensive so create very little value.”

Investors are concerned about lofty valuations and huge capital expenditure by a few large tech groups that could backfire if a handful of lossmaking AI start-ups such as OpenAI and Anthropic fail to deliver on their promises for the technology.

Oracle shares fell 4.2 per cent on Thursday as the Nasdaq tumbled 2.3 per cent — the latest in a series of sell-offs led by tech stocks. The stock recovered some of those losses on Friday.





Oracle has said its deals with OpenAI would generate $300bn of revenue between 2027 and 2032.

Its executives say the rewards will justify the risks due to intense and accelerating AI demand, which far exceeds existing supplies of computing power. Its shares are still up 30 per cent this year.

Oracle’s infrastructure business is forecast to increase revenues by more than 10 times by 2029, according to estimates compiled by S&P Visible Alpha. And the bulk of Wall Street analysts are bullish on its stock.

But Oracle has been aggressive in tapping debt markets to rapidly build its capacity.

The group has about $96bn of long-term debt, up from $75bn a year ago, according to Bloomberg data. Morgan Stanley forecasts this will soar to about $290bn by 2028. Oracle sold $18bn of bonds in September and is in talks to raise $38bn in debt financing through a number of US banks.

Ellison “is now way off the reservation in terms of how he’s spending”, said a short seller who has long tracked Oracle’s stock but does not have an active bet against it. “The market is clearly saying it is no longer interested in companies burning endless cash on AI.”

Barclays analysts this week downgraded their rating of Oracle’s debt from market neutral to underweight, warning that its large expenses on AI infrastructure had outpaced its free cash flow.

Credit rating agency Moody’s has also flagged up significant risks due to Oracle relying on a small number of AI companies. S&P Global warned that a third of Oracle’s revenues will be tied to a single customer by 2028, referring to its reliance on OpenAI.

“That is a huge liability and credit risk for Oracle. Your main customer, biggest customer by far, is a venture capital-funded start-up,” said Andrew Chang, a director at S&P Global.

OpenAI faces questions about how it plans to meet its commitments to spend $1.4tn on AI infrastructure over the next eight years. It has struck deals with several big tech groups, including Oracle’s rivals.



Of the five hyperscalers — which include Amazon, Google, Microsoft and Meta — Oracle is the only one with negative free cash flow. Its debt-to-equity ratio has surged to 500 per cent, far higher than Amazon’s 50 per cent and Microsoft’s 30 per cent, according to JPMorgan.

While all five companies have seen their cash-to-assets ratios decline significantly in recent years amid a boom in spending, Oracle’s is by far the lowest, JPMorgan found.

JPMorgan analysts noted a “tension between [Oracle’s] aggressive AI build-out ambitions and the limits of its investment-grade balance sheet”.

Analysts have also noted that Oracle’s data centre leases are for much longer than its contracts to sell capacity to OpenAI.

Oracle has signed at least five long-term lease agreements for US data centres that will ultimately be used by OpenAI, resulting in $100bn of off-balance-sheet lease commitments. The sites are at varying levels of construction, with some not expected to break ground until next year.

Safra Catz, Oracle’s sole chief executive from 2019 until she stepped down in September, resisted expanding its cloud business because of the vast expenses required. She was replaced by co-CEOs Clay Magouyrk and Mike Sicilia as part of the pivot by Oracle to a new era focused on AI.

Catz, who is now executive vice-chair of Oracle’s board, has exercised stock options and sold $2.5bn of its shares this year, according to US regulatory filings. She had announced plans to exercise her stock options at the end of 2024.

[sudden and sharp]

Smoke On The Water
https://www.youtube.com/watch?v=Q2FzZSBD5LE

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Génesis 1:2
https://www.biblegateway.com/verse/es/Génesis 1:2

[pollo]

Si el éxito evolutivo es la adaptación al medio, muchos de los habituales del foro hemos perdido.Es simple y aplastante lógica.

La vivienda social llegara, claro que sí. Pero convenientemente planificada, ejem, dosificada para no violentar al rentismo. Primero orientado a la extracción social más baja para que socialmente se asuma como necesariio. Y con garantías, que los retornos a cinco años son sagrados. Hay embriones en varias CCAAs.

La "clase media" no querrá vivir ahí ("hay zonas y zonas") y la estafa seguirá porque así se querrá. Nos gusta vivir en la ilusión.

Quince años de crisis templaran ánimos. Y ya nadie recordará los excesos.  Sobrará ladrillo y el problema serán las pensiones.

No es adaptación al medio. Es seguidismo ciego de la masa.

Las bacterias en una placa de Petri con azúcar están adaptadísimas al medio hasta el momento en el que repentinamente se acaba el azúcar y la población colapsa en una millonésima parte del tiempo que tardó en llegar hasta esa situación tan adaptada.

Para declarar tal cosa, hay que mirar a un plazo aún más largo. El medio de pronto puede cambiar. Parte del problema es que la gente extrapola los últimos 3 o 4 años y a eso lo llama "desde siempre". Ese sesgo se lleva ejerciendo en este foro y en la sociedad de forma militante desde que tengo uso de razón. Hasta que de pronto cambian las cosas y nadie lo podía ver venir (que es siempre la misma excusa del que es tonto a propósito).

Yo de momento sigo vivo y mis finanzas sin ser boyantes, me permiten vivir sin miedo y de forma independiente. Además, no tengo ninguna deuda, que es otra cosa a tener en cuenta. Tengo libertad de elección y no estoy atado a nada. Otros están teniendo que tragar lo que les venga porque no pueden renunciar a remar en las galeras.

Si el medio cambia a peor (lo cual por pura estadística es cuestión de tiempo), ya veremos lo adaptados al medio que están los que deben cientos de miles de euros, y sus respectivos acreedores, cosa que ya hemos visto antes, me permito recordaros.

[pollo]

Esta ganancia de poder adquisitivo sí que es RARA, RARA.

Desde el momento que el periódico habla de salarios medios, tiene validez nula como apreciación cualitativa sobre los salarios de los españoles.

Pensaría que es manipulación, si no fuera porque estoy convencido de que el que lo escribe no tendría ni puta idea de a qué me refiero porque "es de letras".

[pollo]

El problema de la vivienda no son las hipotecas | Opinión | Cinco Días https://share.google/OzJgGLgPRO27ImSbc

Las hipotecas siempre fueron un síntoma.

[sudden and sharp]

Esta ganancia de poder adquisitivo sí que es RARA, RARA.

Desde el momento que el periódico habla de salarios medios, tiene validez nula como apreciación cualitativa sobre los salarios de los españoles.

Pensaría que es manipulación, si no fuera porque estoy convencido de que el que lo escribe no tendría ni puta idea de a qué me refiero porque "es de letras".

Ya, ya.

Pero es la EPA. Lo que usa la UE. Que es la que exige un salario mínimo del 60 % del medio.

Así, con un 3% de crecimiento en 2025, deberíamos --para cumplir con la UE-- empezar el año 2026 con 1474€ de salario mínimo e, idealmente, acabarlo con 1518 €.

No son cifras disparatadas... sólo he supuesto un 3% de crecimiento en 2025, y otro tanto en 2026.


Justo lo que dice aquí:


La Generación Z necesita el 146% del SMI para sobrevivir. La diferencia respecto a Boomers y Milenials es alucinante
https://www.3djuegos.com/3djuegos-trivia/noticias/generacion-z-necesita-146-smi-para-sobrevivir-diferencia-respecto-a-boomers-milenials-alucinante
 -  La Generación Z necesita el 146% del salario mínimo para cubrir gastos
 - La cifra es mucho más alta que la de Boomers, Generación X y Milenials





No se podrá hacer, seguramente, de un sólo salto. Pero sí marca donde hay que llegar a la mayor brevedad posible.

 



Hot chocolate
https://www.youtube.com/watch?v=0BZ8ouCKeyk



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[ Cómo se os ve el plumero... ]