(2025-10-14) Hunt Its The Smart Move

Ben Hunt: It's the Smart Move. No one starts off intending to run a Ponzi scheme like Madoff or SBF. No one starts off intending to falsify test results like Elizabeth Holmes. No one starts off intending to double-pledge collateral like Tricolor... dozens of senior and subordinated lenders, none of whom were aware of the full extent of the lending web, like First Brands.

You start off with good intentions, a simple org chart and a foolproof idea. You start off with loyalty, gratitude and transparency towards your partners, funders and clients. But then you hit a bump in the road

Maybe it's not technically 'legal' to do what you need to do, but you tell yourself that it's only a temporary measure

You promise yourself that if this works out you will never ever ever do this thing again. And it does work out!

And then you hit another bump in the road.

This time, though, as you start to do again whatever it was that you promised yourself you would never do again, you tell yourself a different story.

Until you are found out. Because you are always found out.

Luckily you see a way out

But this time you can't find the new source of funding that's always bailed you out in the past.

And so you miss a payment. And so a creditor declares a default. And so you are found out.

But what is freaking out Wall Street is less the specific mechanisms of fraud (because there are a million specific ways to do fraud) as the non-fraudulent but insanely opaque and complex structures and practices...because those same non-fraudulent but insanely opaque and complex structures and practices are EVERYWHERE in the private credit world. (corporate debt)

Here's how we figure out if the private credit market in 2025 is stronger and more resilient than the mortgage-backed securities market in 2007. (credit crisis 2008)

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