Mohamed El-Erian, Allianz chief economic adviser, is pointing to widening cracks in private credit markets. He said the signs mirror JPMorgan Chase & Co. CEO Jamie Dimon\u2018s earlier \u201ccockroach\u201d warning \u2014 and more \u201cbugs\u201d are now in plain sight.<\/p>\n
El-Erian Raises the Termite Question <\/p>\n
El-Erian wrote on X on Friday that this week\u2019s private credit news \u201cechoes Jamie Dimon\u2019s recent warning about \u2018cockroaches\u2019\u2014the idea that early signs of excesses are likely to be followed by others.\u201d<\/p>\n
He listed \u201cvaluation gaps and liquidity strains to poor underwriting and fraud\u201d as the \u201cbugs\u201d now emerging.<\/p>\n
Then he sharpened the concern: \u201cThe big question for markets and the real economy is whether we\u2019re just dealing with cockroaches\u2026 or are these termites posing systemic risks?\u201d<\/p>\n
Don’t Miss:<\/p>\n
El-Erian said he suspects it isn\u2019t a systemic termite issue alone. But he urged investors to watch how private credit interacts with other risks \u2014 including \u201celements of an AI bubble\u201d and \u201cvulnerabilities in certain segments of the global bond market.\u201d<\/p>\n
Cockroaches or Termites? The Private Credit Question:
This week’s news from the private credit markets in advanced economies echoes Jamie Dimon’s recent warning about “cockroaches”\u2014the idea that early signs of excesses are likely to be followed by others.
From valuation gaps and\u2026<\/p>\n
\u2014 Mohamed A. El-Erian (@elerianm) March 6, 2026<\/a><\/p>\n Blue Owl Capital Becomes the Crisis Face <\/p>\n Blue Owl Capital Inc. is down over 34.59% year-to-date. Shares have fallen 48.27% over the past year.<\/p>\n In February, Blue Owl announced it would liquidate $1.4 billion in assets to return capital to exiting investors. CEO Craig Packer called it a \u201cstrategic transaction.\u201d<\/p>\n Trending:\u00a0Own the Characters, Not Just the Content: Inside a Fast-Growing Pre-IPO IP Company<\/a><\/p>\n Dimon\u2019s Warning and Lipschultz\u2019s Clap-Back <\/p>\n Dimon likened credit bankruptcies to spotting a cockroach \u2014 if you see one, more are likely lurking. El\u2011Erian echoed the warning earlier in a CNBC interview, saying, “Cockroaches don’t come in ones and twos.”<\/p>\n Blue Owl co-CEO Marc Lipschultz pushed back. Speaking at the CAIS Alternative Investment Summit, he quipped: \u201cThere might be a lot more cockroaches at JPMorgan.\u201d He called broad concern \u201can odd kind of fear-mongering.\u201d<\/p>\n The debate was lit by the bankruptcies of First Brands Group and Tricolor Holdings, two events that rattled investors and slammed regional bank stocks.<\/p>\n See Also:\u00a01.5 Million Users Are Already Working Inside This AI Platform \u2014 Investors Can Still Get In<\/a><\/p>\n Wider Cracks Across Private Credit <\/p>\n BlackRock Inc. slashed a private loan to Infinite Commerce from 100 cents to zero in just three months, per Bloomberg. That par-to-zero swing exposed the lag between reported valuations and real performance.<\/p>\n Apollo Global Management Inc. and KKR & Co. Inc. have also faced monthly losses as software-heavy portfolios draw scrutiny.<\/p>\n New York Life Investments, in a February report, said the sector remains prone to headline risk but maintained a constructive outlook. It called for investors to prioritize selectivity, strong underwriting, and disciplined exposure.<\/p>\n Image via Shutterstock<\/p>\n Read Next:\u00a0It\u2019s no wonder Jeff Bezos holds over $250 million in art \u2014 this alternative asset has outpaced the S&P 500 since 1995, delivering an average annual return of 11.4%. Here\u2019s how everyday investors are getting started.<\/a><\/p>\n UNLOCKED: 5 NEW TRADES EVERY WEEK. Click now to get top trade ideas daily<\/a>, plus unlimited access to cutting-edge tools and strategies to gain an edge in the markets.<\/p>\n Get the latest stock analysis from Benzinga:<\/p>\n This article Jamie Dimon Warned Of ‘Cockroaches’ \u2014 Now Mohamed El-Erian Says More ‘Bugs’ Are Crawling Out In Private Credit<\/a> originally appeared on Benzinga.com<\/a><\/p>\n