Bethany McLean

speaker

391 appearances 2 recordings 1 series first heard Jul 2026 last heard 2 Aug

Bethany McLean’s voice in public audio — every appearance, attributed to the second.

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Recordings per month over the last 12 months — 2 in all, peaking in Aug 2026 with 1.

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Motley Fool Hidden Gems Investing · Part 1: How to Spot a Corporate Fraud Before It Makes the Headlines · 26 Jul 2026 podcast

They've also been wrong about a lot of things.

And the confidence of the markets and Musk, his ability to raise money, has not cracked.

So that's the most important thing, right?

And unless that cracks, he will continue to be a visionary.

So I do.

I wrote a piece for Inc.

actually about private credit and why I was worried about it.

And I do think it carries some of the same risks because the whole premise of private credit is that we built a better mousetrap because now lending is match funded, meaning that the investors who are putting money into private credit are asking for their money back on the same schedule that the companies are repaying it.

So you don't have the risk of a run on the bank.

But of course, Wall Street being what it is, they've come up with ways to not necessarily kill their own golden goose, but potentially name their own golden goose.

So by doing these evergreen funds that promised semi-liquidity to investors where you could supposedly get some of your money out on this specific schedule, they undermined that whole premise of match fundings.

And I think that's where Wall Street's greed is similar this time around to what it was in the financial crisis, which was Wall Street saying, oh, my goodness, mortgages made to people who can't pay them back can be packaged up into these really high yielding securities and sold to investors around the globe who just look at the AAA rating and don't really understand what it is they're buying.

And they just cranked the machine and cranked the machine until it broke.

And so in this case, these loans, these private credit loans are also being sliced and diced into different types of securities, a great portion of which are being sold to insurance companies and to buyers that in some cases are captive of the private credit firms that are making the loans.

There's just a lot of potential in there for bad things to happen.

There's also been a change on Wall Street in that some of these private credit firms and the private equity firms that have gone into private credit are now themselves publicly traded.

And because they're publicly traded, their incentive is to put as much money to work as possible.

because their stock is valued based on fees on the assets they have under management.

So growing the assets under management is more important than earning an incentive fee on the products they've created.

So it's changed the whole incentive structure.

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