Making Markets · Colossus | Investing & Business Podcasts

Phil Huber: The Case for Private Credit - [Making Markets, REPLAY]

·44 min·2 clips

Phil says headlines like 'high yield was oxy, private credit is fentanyl' would have scared investors out of four and a half years of returns.

1. Making Markets focuses on private credit with Phil Huber, Head of Portfolio Solutions at Cliffwater. 2. Eric Golden hosts the conversation, and Phil Huber matters because he has moved from RIAs to Cliffwater after years as an investor in alternatives. 3. The episode asks why private credit has grown to $1.2 trillion and why RIAs are adopting it now. 4. Phil says he spent about 12 years at Huber Financial, the firm founded by his father, before becoming CIO and later joining Savant Wealth Management. 5. He says the switch to Cliffwater came from an interest in alternatives, writing, research, and product strategy. 6. Cliffwater is in its 20th year, but Phil says only five of those years have been as an asset manager. 7. He says the first 15 years were alternatives consulting for pensions, endowments, and sovereign wealth funds. 8. Phil says alternatives in wealth management moved through phases, starting with publicly traded REITs and commodities. 9. He says the next phase was post-GFC liquid alts, including hedge-fund-style strategies inside mutual funds and ETFs. 10. He says the current phase is evergreen or perpetual structures like interval funds, tender offer funds, private REITs, and private BDCs. 11. Phil says the post-GFC liquid alts wave disappointed many advisors because performance chasing followed the crisis. 12. He says many traditional managers launched long-short or market-neutral funds when demand appeared, and many later closed. 13. He says evergreen wrappers matter because they bring periodic liquidity, lower minimums, 1099 tax reporting, and model-portfolio use. 14. Phil says private credit demand comes largely from middle-market direct lending to private equity buyouts. 15. He says Dodd-Frank reduced bank lending and private credit filled that gap as companies stayed private longer. 16. He says the term private debt usually means corporations with EBITDA from about $10 million to $200 million. 17. Phil rejects the bubble framing by pointing to historical credit spreads that remain within historical ranges. 18. He says the CDLI index, created by Steve Nesbitt in 2015, gives a roughly 20-year proxy for direct lending performance. 19. The interview style is direct and technical, with Eric pressing on bubbles, distress cycles, due diligence, and volatility. 20. Listeners who follow RIAs, private credit, and portfolio construction will get the most from it, while readers wanting consumer finance tips may skip it.

Listen to the show on

Apple Podcasts Spotify

Play clips from this episode More from Making Markets