Co-Chairman, Oaktree Capital
Catching Up With Power Investors Howard Marks and Bruce Flatt | At Barron's
Bruce Flatt, CEO of Brookfield Corporation, and Howard Marks, co-chairman of Oaktree Capital Management, spoke with Barron's editor at large Andy Serwer. This interview was filmed on June 9, 2026.
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About Howard Marks
Howard Marks, co-chairman of Oaktree Capital Management, has been active in media appearances discussing market cycles, the current investment environment, and the role of artificial intelligence in investing. In a June 2026 interview with Barron's alongside Brookfield CEO Bruce Flatt, Marks stated that since October 2022, "optimism has been in the ascendancy" in markets, which he said permits events like large IPOs. He described the current environment as one of "exuberance," but noted that he could not definitively say whether it is irrational, given uncertainty about what AI will be able to do and for whom. Marks also discussed the four ways he believes investors achieve superior returns: buying things for less than they are worth, applying the right financial structure, adding value to operations, and seeing assets go to a premium valuation. He said that in the period ahead, he expects a greater emphasis on "an ownership mentality, on buying things at reasonable prices and adding value." In separate appearances, Marks addressed the IPO market and AI. On the Prof G Markets podcast, he said that investing in companies like Anthropic or OpenAI involves accepting that one's activity is "closer to speculating than analytical investing," given the difficulty of forecasting earnings far into the future. He also said that while AI can marshal data and organize logic, he does not believe it can directly pick winning stocks, as successful investing still requires judgment and experience. Marks stated that AI "raises the bar and weeds out the people who don't add value," but added that he does not think it will replace the best investors.
Transcript (44 segments)
✨ AI-enhanced transcript with speaker attribution
A
Andy Serwer0:10
Hello everyone and welcome to At Barrens. I'm Andy Serwart and welcome to our guest Bruce Flatt, CEO of Brookfield Corporation and Howard Marks, co-chairman of Oaktree Capital Management. Bruce, Howard, nice to see you. Thank you so much for joining us.
B
Bruce Flatt0:23
Great to be here.
H
Howard Marks0:24
Thank you.
A
Andy Serwer0:24
So Brookfield is the big alternative investment company. Oaktree is also an investment company which is specialized in distressed debt. We're talking to both of you because Brookfield now owns Oaktree. Bruce, why don't I start with you? You bought a big piece of Oaktree in 2019 and more recently now you've bought the entire company. Why did you buy it in the first place, the piece? And why did you buy the whole thing now?
B
Bruce Flatt0:49
Thanks for having us, Andy. We're in the business of providing backbone infrastructure around the world. What that really means is we build, own, operate, and lend to the largest groups of infrastructure on the planet. Think railways, pipelines, data centers, AI factories, transmission lines, and renewable power. Seven years ago, we had equity strategies in all these and small funds where we could provide lending. We looked around the world and said if we were going to achieve excellence for our clients, we needed to have the best in credit, and it was going to take us a long time to get there. We approached Howard to bolt Oaktree underneath Brookfield, and he agreed to do that. We did it in a special way: it took us seven years to slowly assimilate what we wanted and leave our investment teams decentralized. We're now bringing the whole thing together, and our clients will be advantaged by having it together. We've had seven years to test everything out, and everything's now running very effectively. Now we have credit in scale that we can provide to our clients, and that's really the reason for doing it. It's been a great success.
A
Andy Serwer2:24
Howard, let me turn to you and ask you a similar question. Why did you sell and how's it going? How's the partnership going?
H
Howard Marks2:33
The partnership is going extremely well. It has been marked by mutual respect, cooperation, helpfulness. Bruce used the term decentralized. Brookfield is not a control freak and has not inserted itself in our investment process, which to us and our clients was the most important thing. Brookfield has given us additional resources that help us do a better job. In particular, we were attracted to Brookfield's nature as not just a third-party investment manager but also as a proprietary owner of assets for its own interests, a capital-rich company. With Brookfield's contribution, we have been able to put more capital into our own strategies, which strengthens the alignment of interest between us and our clients and redounds to their benefit.
A
Andy Serwer3:46
Sounds like you're going to keep the brand name Oaktree.
H
Howard Marks3:48
Yes, sir.
A
Andy Serwer3:49
Okay. So, you guys are two very well-known, prominent, successful investors. How much do you talk to each other? Do you work together and discuss ideas or is it just management? First of you, Howard.
H
Howard Marks4:02
I joined the Brookfield board at the beginning of this process, just over six years ago, so I've been involved in that way since then. I give Bruce my ideas and vice versa. We don't have an in-the-weeds working relationship. Other people share ideas at the senior level just below us and have more of a day-to-day relationship.
A
Andy Serwer4:40
What about you? What do you think?
B
Bruce Flatt4:41
With a trillion three of things around the world...
A
Andy Serwer4:48
That would be investments or assets or dollars?
B
Bruce Flatt4:52
Total assets. He nor I make any real decisions. What's extremely important, what Howard has been helpful with, is we care about the culture of the organization and how we're investing, the ethos of how we invest and what we do as an organization. How much you should invest during periods of time, should you be heavy up or slowing down? Those are important, and Howard and I spend a lot of time talking about those types of things, which are extremely important from an overall perspective of an organization. Investments aren't about getting rich overnight; they're about compounding wealth over very long periods of time. One of the benefits we got by bringing Howard in is to help us continue to be among the best in the world in understanding global capital markets and where flows go, because it's really important to what we do.
A
Andy Serwer5:57
Has he sprung any aphorisms on you during meetings?
B
Bruce Flatt6:00
Daily.
A
Andy Serwer6:02
So I want to ask you a little bit about Brookfield stock, which has been very successful over a long period of time, and in particular the last two years, Bruce, where you have a market capitalization of around 100 billion and you've outperformed the peers, which is to say the likes of Blackstone and KKR and Apollo. Why is that?
B
Bruce Flatt6:22
The markets are the markets. We have a large balance sheet. With our insurance assets and our own balance sheet, we have about $400 billion of assets on a deconsolidated basis in Brookfield Corporation. 160 billion of that is equity capital, and we invest that beside our clients. So we have both a fee business in Brookfield Asset Management, which is separately listed and we own 73% of, but a very large balance sheet at the top. During periods when people are worried about markets or alternative managers, our businesses, because of the durability of the streams of cash flow we have, have probably been seen as a much safer investment than others similar to us. While we have private credit, it's mostly opportunistic. Our biggest business is infrastructure, and these are very long-duration assets. Over the shorter term, over 30 years we've compounded almost 19% annualized. The business, because of scale, operating capabilities, and our size with institutional clients, has been getting easier because there's less competition in what we do given the scale of our operations.
A
Andy Serwer7:56
Howard, I want to ask you a little bit about the equity markets, which is not necessarily your bailiwick, but I know you like to weigh in. Given the fact that stocks are at record highs, we're looking at these three big IPOs, SpaceX, Anthropic, and OpenAI coming with these huge valuations. What's your take on the stock market right now?
H
Howard Marks8:18
Andy, to me, if you want to gauge the conditions in the stock market and use that to infer what the future holds—not next month or next week, but the next two to four years, the intermediate term—I think the most important single indicator is to understand whether the market is currently being driven by optimism or pessimism. Everything else being equal, when it's driven by optimism, you get higher prices relative to intrinsic value, which implies lower returns relative to the average. I think there's no arguing that for the most part, since October 1st of 2022—a special date because that's when the Fed turned more dovish—optimism has been in the ascendancy. Optimism is what permits things like the IPOs we're looking at. You can't have that in a pessimistic environment. The stock market has well more than doubled over that period, the S&P 500. So you have to recognize the ascendancy of optimism and behave accordingly. Part of that means with everything you do, some part of your body has to be saying, 'Yes, but how do we prepare for less optimistic times?'
A
Andy Serwer10:11
All right. I want to ask you about the credit markets then. Where do you think we are in the cycle with credit markets? And what do you think Kevin Warsh is going to do? And what should Kevin Warsh do? And Bruce, by the way, I'm going to ask you the same two questions about equity and debt. Be prepared.
H
Howard Marks10:29
The credit markets have been on a tear for the most part of the last 17 years. We came out of the global financial crisis as the stock market hit a low in March of '09. That was the low water mark for everything: stocks, credit, optimism, everything. We've pretty much had uninterrupted progress since. There was the pandemic, but that was easily solved and it's certainly in the rearview mirror today. We had a bout with inflation and had to hike interest rates, but things have gone quite well. The economy has performed very well. We had the longest recovery in history and a slight setback, but again performing very well. I think our economy is the envy of the world. So you take this all together with rising optimism, and you get a market in which it's easy to borrow. The credit market is generous. When the totality of conditions I described takes place, fear recedes, skepticism declines, due diligence declines, and willingness, eagerness takes over along with FOMO. 'If I don't cut the price of this loan, my competitor will make the loan and I'll have to look on.' This is what happens. The credit cycle has been very strong. It's gone on with the interruption of the pandemic, probably the longest time in history. Market conditions in credit are generous, and borrowing is easy. We have to bear that in mind and try to uphold high standards on behalf of our clients.
A
Andy Serwer12:43
Should Warsh raise rates?
H
Howard Marks12:46
First, I would never tell Kevin or any Fed chair what to do. I wouldn't propose that I'm more qualified for that role. But I think I would start off by taking the negative: I don't see any reason to cut rates. I don't think this economy needs stimulus. The economy's doing fine. When the economy is doing fine, there's no reason to take a stimulative position. We certainly don't want to make it easy for inflation to rekindle. I guess there are reasons to raise and not to cut.
A
Andy Serwer13:32
Okay. Let's go back to equities then. What do you make of the stock market, Bruce, given what we're seeing right now with all this excitement?
B
Bruce Flatt13:43
Our business is not about investing in the stock market. It's about making private investments in things that could be in the stock market or can be purchased in the stock market. What's happening is there is a bifurcated market out there. If companies are technology-related—and these big IPOs are the antithesis of it—those things are going on at one multiple, but there are a lot of other companies trading at multiples that are low. We've been taking many companies private. I'm quite confident that all the investments we've made in the past 24 to 36 months and for the next 24 to 36 months will be excellent investments in the fullness of time and will earn their return on capital as long as we run them properly and drive the businesses and operate them well. We're able to buy things in the private markets, some of them from the stock markets, because multiples are low on these cash-flowing businesses that people have forgotten about. Overall markets are one thing if you're an index investor, but when you are skilled enough to just own businesses, there are some exceptional opportunities still out there. The only second thing I'd say is what's going on with the investment being put into productivity advances. All this compute is productivity advances for business, whether in factories, offices, or houses. If this investment works, we will drive one of the most productive operating periods in the history of the world. That's why stock markets are high. It's not to say they can't go lower—they will go lower at some point, that's called markets—but the underlying fundamentals and the earnings power being created by some businesses is very significant today.
A
Andy Serwer16:09
You're not concerned about a bubble in this sort of AI-driven economy in terms of electrification? This is an area where you do play heavily: electrification, data centers, etc. As you mentioned, aren't prices getting too high there?
B
Bruce Flatt16:22
If the expectation is that we're going to build this much, the reality is we're the largest private builder of power in the world. We're one of the largest builders of data centers in the world. The expectation of what people need is here, and what we're building is here. It is dramatically less because this is hard to do. You have to site the power, connect it to the plant or the grid, build the facility, put chips inside, and you have to have between 20 and $250 billion. This is not easy, and it's hard work. Therefore, the amount that's coming is dramatically less than what people think. We're leasing to the best countries in the world for sovereign AI and to the best companies in the world, some of which are rated better than countries. We're getting 25-year contracts from them. Their expectation is that they will be able to utilize that more productively and earn high returns on capital. That's what's to be seen. But these are the most successful companies in the world, and if anyone you would bet that they can do it, it's them.
A
Andy Serwer17:57
Howard, there's been a lot of talk about problems in the software business impacting private credit. Are you starting to see a spike or do you anticipate one in distressed debt in this area or in any area at this time?
H
Howard Marks18:17
We anticipate opportunities. At the present time, there's no spike in distress. There's a spike in worry about the possibility of distress, but the companies are not failing, revenues are not declining, most of them have no problem servicing their debt. I think there's an expectation, and investors tend to paint things with a broad brush and not make fine distinctions. I personally think that the level of worry and the universality of worry with regard to software is probably excessive. Things will not be as bad as people believe at this time. Certainly some will have problems on a case-by-case basis, but you have to lose a lot of value and a lot of revenues before companies actually have problems paying their debts.
A
Andy Serwer19:23
Right. Shifting gears a little bit back to you, Bruce. You're Canadian. Brookfield is a Canadian company, and I'm wondering what your take on US-Canada relations is at this particular point. Mark Carney, of course, Prime Minister of Canada, used to work at Brookfield.
B
Bruce Flatt19:43
We have $600 billion of investments in the United States. I think that would rank us maybe as the largest private investor in the United States, if not in the top five. We are a local investor in every country we go to. We invest in a country and provide services to companies or individuals. We provide the road, the water, the power, the data center, compute to them. We're a local investor, and we do that to local people. We do that in Canada, the United States, Australia, France, South Korea, all over the world in the places we've chosen in 40 places. What's really important is we go to good countries with good rule of law and the wind behind their back for economic development, where you can earn a return. Whether we started in Canada or not, 90% of our things are outside of Canada. Canada is still a great place to invest, and we put enormous money there. We probably have an advantage in investing in Canada because of our cultural roots. Whether Canada, the US, France, UK, Italy have a trade agreement or do things together, we have no view because we're a local investor in each single country, and we don't really have a view on what matters for trade.
A
Andy Serwer21:32
All right, I guess I'll let you get away with that, but then you have to tell me how you think Mark Carney's doing.
B
Bruce Flatt21:37
He was with us almost five years. He's an excellent executive from what I've observed. Since he's been in power, he's doing a fantastic job. If Canada has a chance in dealing with their issues, he's an excellent person to put in the job.
A
Andy Serwer21:58
Some people, Bruce, have criticized Brookfield for being too complicated. How would you respond to that?
B
Bruce Flatt22:06
From time to time we always try to slim down and uncomplicate things. It's a multi-diverse business where we've tried to optimize the capital markets and take care of investors in a way where we care about their taxes or their duration of investing and different things. Sometimes that brings more time-consuming structures to understand. We get that criticism from time to time, but what I can tell you is most investors that know us and have invested with us have had an extremely good experience because we've earned them very good returns. We're very transparent with our governance. They know what we do and how we do it, and we're very open and communicative with them. We just maybe take a little more time to think about.
A
Andy Serwer23:10
Howard, have you been surprised at how the public and private markets have evolved? I guess in particular the private markets, and I guess when I'm saying both of them I mean sort of in conjunction. Has this evolution surprised you?
H
Howard Marks23:25
I didn't foresee the growth of private credit, the part of private credit which loans money for midsize buyouts, we call direct lending. It went from essentially zero 15 years ago to 1.7 trillion today. I didn't know that was coming. When I started in the investment management business a long time ago, very little investing was in private assets. Insurance companies did something called private placements, but other than that it was stocks and bonds. The evolution has gone a long way, in particular abetted by how well leveraged investments did in the period of declining interest rates and by the fact that the environment has been so positive, especially for the last 17 years, that people haven't seen it as having a downside to being private. In less parlous times, they say, 'I wish I could get out. I wish I had liquidity.' In good times, they don't think in advance about the possible need for that.
A
Andy Serwer25:00
I'm going to ask a final question to both of you, and I'll start with you, Bruce. What is something that investors are missing about the markets that will inform their thinking about the future?
B
Bruce Flatt25:18
The most important thing that investors always have to focus on, but in particular in times like this, is that earning returns is about compounding wealth over very long periods of time. What you need to do is buy into great businesses with great people who can steward your capital and run the business well. If you do that, the miracle of compound wealth is incredible. Mr. Buffett showed us that over the last 50 years, and it's no accident that he's extremely successful because of it. The compounding of returns over time is an amazing thing, and it often gets forgotten about at points in time when the stock markets go high or low. We keep that very focused in our mind at all times.
A
Andy Serwer28:18
Howard Marks and Bruce Flatt, thank you both so much for joining us.
B
Bruce Flatt28:22
Thank you.
A
Andy Serwer28:23
This is At Barrens. I'm Andy Serwer. We'll catch you next time.