In the latest edition of Credit Exchange with Lisa Lee, Alan Schrager, senior managing partner of Oak Hill Advisors, speaks with Creditflux's managing editor Lisa Lee about the cross-currents in credit markets which is blazing hot with spreads going tighter but there’s issues of tariffs, immigration reform and defaults.

Spreads have gone tighter in many markets, not only credit or private credit, while there's a number of pressures on companies, including tariffs, which Schrager suggests means it's better to invest in higher-quality investments. The spread between “great stuff, good stuff, and bad stuff and terrible stuff” is the tightest it has ever been, he noted.

Of the headwinds, immigration reform will have a greater impact than trade protectionism, he predicts, since the industries that are impacted by tariffs will adjust.

On this inaugural episode of Credit Exchange, host Lisa Lee sits down with Fortress co-CEO Drew McKnight who sees the best play of 2025 in asset-based finance as banks become increasingly disintermediated. While President Donald Trump's win may loosen bank regulations, banks will still need to comply with Basel III and shore up liquidity to deal with asset-liability mismatches. Fortress is cautious about direct lending, the largest segment of private credit, but optimistic about its future given the improving M&A and LBO climate. Geopolitics remains the looming worry while the incoming Trump Administration could pressure corporate profits with tariffs and wage inflation but result in better outcomes for consumers.

Credit Exchange with Lisa Lee. Explore the latest trends in global credit markets with the biggest movers and shapers on Wall Street and the City, hosted by financial reporting veteran Lisa Lee.