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What Happens if a $40 Trillion Bubble Bursts?

There’s been a simmering anxiety since the fall that trouble is brewing in the private-credit market, and high-profile redemption requests have only added to the panic. There may be cockroaches in the system, but Wall Street superstars Marc Rowan and Jon Gray insist it’s all just a bunch of bad actors on the periphery.

Marc Rowan
As Apollo C.E.O. Marc Rowan likes to say, cup of coffee in hand, the private-credit market’s true size is not just the $2 trillion of riskier levered loans. Rather, when you include the huge collection of senior secured first-lien loans, it’s more like $40 trillion. In other words, a lot of investor money has flowed into the private-credit market in the past 15 or so years. Photo: Michael Nagle/Bloomberg/Getty Images
William D. Cohan
March 15, 2026

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The current anxiety in the private-credit markets, as I’ve written before, began around last November. That’s about the time when Wall Street executives began to note the recent bankruptcies of First Brands and Tricolor, and eminences such as Jamie Dimon, Howard Marks, and Jeffrey Gundlach began crowing about cockroaches in the system and garbage lending akin to the subprime shenanigans that precipitated the 2008 crisis. Coincidentally, this was also around the time when investors in a $1.6 billion private-credit fund with the obscure name OBDC II started making noises about wanting to redeem some of their money.