Howard Marks on private credit
From Howard Marks - Reflections on Oaktree Conference 2026 - Oaktree Capital · · Gilberto Santos
“I think that the warts, which get overlooked in the good times, come to the fore in the bad times. Buffett says, 'It's only when the tide goes out that we find out who's been swimming naked.' In the last few months, the tide has been going out, especially in areas like private credit, and we start to see which structures may have been unwise. We actually haven't had many defaults yet, so we haven't had a chance yet to see who made bad loans. That's coming, too.”
On , Howard Marks, Co-Chairman at Oaktree Capital, spoke about private credit during Howard Marks - Reflections on Oaktree Conference 2026 - Oaktree Capital on Gilberto Santos.
About Howard Marks
Howard Marks, co-chairman of Oaktree Capital Management, has been a frequent commentator on market conditions and investment philosophy in mid-2026. In a June 2026 interview with Barron's, Marks stated that he does not see a reason to cut interest rates, arguing that the economy is "doing fine" and does not need stimulus. He described the most important indicator for investors as understanding whether the market is driven by optimism or pessimism, noting that optimism leads to higher prices relative to intrinsic value and lower expected returns. Regarding the wave of high-profile IPOs from companies like SpaceX, Anthropic, and OpenAI, Marks said in a separate interview that investors should accept that such investments are closer to "speculating" than "analytical investing," given the enormous uncertainty around future earnings. He remarked that if the current technological exuberance does not produce a money-losing bubble, "it'll be the first." Marks has also discussed the role of artificial intelligence in investing. He stated that AI can act as a mentor by analyzing data and generating ideas, but he argued that it is weakest at analyzing "brand new things where there aren't established patterns." Marks said he believes AI will "raise the bar and weed out the people who don't add value" but will not replace the best investors. At Oaktree's 2026 client conference, he reiterated the firm's focus on risk control and avoiding losers, stating that the firm's motto is "if we avoid the losers, the winners take care of themselves." He also reflected on the firm's history, noting that a decision to keep a fund smaller than demand allowed helped create Oaktree's reputation.
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