Steve Tananbaum on credit market outlook
From AI Financing Is an Arms Race, Says GoldenTree's Tananbaum · · Bloomberg Technology
“When we spoke in January, at Davos, I mentioned how the setup was poor for credit and good for equities. Historically, when you've had stretched valuations, in a mid cycle where the economy is expected to grow at 2% or better, your returns in credit are less than the coupon. And that's exactly what's happened so far.”
On , Steve Tananbaum, Founder & CIO at GoldenTree Asset Management, spoke about credit market outlook during AI Financing Is an Arms Race, Says GoldenTree's Tananbaum on Bloomberg Technology.
About Steve Tananbaum
Steven Tananbaum, founder and CIO of GoldenTree Asset Management, appeared at several industry events in the first half of 2026, including the Bloomberg Global Credit Forum, the Milken Institute Global Conference, and an NYU symposium. He described the current environment for credit as challenging, stating that the setup was poor for credit and good for equities, and that inflation is the biggest risk in the market. Tananbaum said he expects credit to continue to languish, though he identified pockets of opportunity in out-of-favor sectors such as telecom, cable, and software, as well as in structured products and private credit, where he said value has improved relative to the prior 24 to 36 months. Tananbaum characterized the financing of artificial intelligence as an arms race, questioning whether the infrastructure investment would be justified or resemble past overbuilds like underwater cable. He attributed recent pressure in private credit to vintage dynamics from 2022–2023 rather than systemic risk, and noted that some open-ended private credit funds have exited the market, leaving more deliberate buyers. On the macroeconomic outlook, he said the market is still sorting out the ramifications of higher-for-longer oil prices and the ongoing war, and that his firm’s thesis that midcycle valuations and stretched yields are not a good environment for below-investment-grade investing is playing out the longer the conflict continues.