Blackstone is now selling data-center loans as opaque CMBS, a self-reinforcing leverage dynamic reminiscent of the 1990s manufactured-home crisis. Per another investor, seven data centers have been packaged into one CMBS, fully occupied by four confidential investment-grade tenants and three small network carriers. Buyers may not scrutinize these securities closely, since the institutions creating them also manage the pensions. x.com  x.com 

Blackstone, KKR, Apollo, Ares and Carlyle face a re-pricing, not a correction, because AI capex is artificially inflating S&P 500 earnings. Hyperscaler capex becomes Nvidia revenue, whose profits make the index look healthy, but those are front-loaded accounting gains, not durable cash flows. When the capex cycle slows, the reversal hits everything downstream, including alternative managers and private credit. Per @Fiscal_ai, drawdowns already run from 33% at Carlyle to 46% at KKR and Ares. … Show more

Blackstone is a forever holding because when markets go wrong, as they always eventually do, the company just gets stronger. That conviction holds even with the stock down 23.1% year to date. x.com 

Long-dated US Treasuries look favorable as the rise in 10-year yields appears mostly over; inflation searches have peaked, and only 13 of 29 tracked commodities are above their 50-day averages. x.com  x.com  x.com 

The US large-cap correction isn't over until interest rates top and bonds bottom, which hasn't happened yet. The summer 2023 S&P 500 correction ended right when bonds bottomed in October, with TLT trading massive upside volume, and there is no sign of that now. Higher rates keep pressuring real estate, where lots of money has been trapped since 2022, a possible source of downside dislocation, and an aggressive further rise in rates could bring a panic bottom. x.com  x.com  x.com  x.com  x.com  x.com 

Blackstone is proving that scale can still drive growth, making it a high-quality compounder at a fair price. Q2 distributable earnings rose 26%, fee-related earnings 22% and AUM 11%, with a $185B data-center platform and over $555B of perpetual capital. Private-credit concerns remain, but diversification, fundraising power and AI-infrastructure exposure strengthen the long-term case. At about 20x forward earnings with a 4%-plus forward yield, it looks attractive, though not deep value. x.com 

Treasury yields are putting in a top, and bonds look to be at a major bottom. Deflation is coming, and investors are extrapolating rate momentum, adding two plus two and getting six; that move will likely reverse soon. The fear in questions about how high rates can go is typical of major bottoms. Equity markets are not close to signaling a reversal either. x.com  x.com 

The secular rise in Treasury yields will likely last longer and go further than most expect, making bets on a yield low premature. Investors tried to time the low in yields from the early 2000s and were 20 years early. The most rate-sensitive sectors, homebuilders, mortgage names and private equity, where smart money would show up first if a turn were near, show no hint of accumulation. x.com  x.com 

Long-dated US Treasuries face pressure because the market will buy US debt only at 5%-plus yields, with no short-term fix in sight. The 10-year yield keeps climbing parabolically as Washington issues enormous debt to fund deficits, investors demand more compensation for inflation and duration risk, the Fed is now raising rates, and Treasuries must compete harder for global capital. The government seems reluctant to act, while rising oil prices add to inflation pressure. x.com 

Long-dated Treasuries are under pressure from AI's debt explosion and rising inflation volatility, as shown in a chart by Bloomberg's Simon White. The basis trade is in a shaky state and oil is back near $100, among many other factors, and it is unclear how much longer private equity and private credit can hold their breath. x.com