In their 2026 macro-commentary, Ted Goldthorpe and Mike Terwilliger from BC Partners Credit strike a cautiously constructive tone. Accommodative fiscal and monetary policy and reduced policy uncertainty provide meaningful support to growth, but the U.S. economy remains exposed to downside risks from a softening labor market and crushing government deficits. Markets may be underestimating the fragility of today’s AI-driven optimism — as quickly as the boom emerged, sentiment could reverse, which would stall capex and unwind recent wealth effects.
Despite this backdrop, the team challenges the recent swirl of negative private market headlines. The collapse of First Brands, often cited as a cautionary tale, is instead presented as a case study highlighting the value of covenants, selectivity, and disciplined underwriting. With public equities richly valued, spreads at or near multi-decade tights, and large-cap private credit increasingly commoditized, BC Partners Credit argues that private credit remains one of the few areas offering durable, risk-adjusted returns. To achieve these returns, capital must be deployed in the right segments – lower middle-market financing, non-sponsor lending, and segments of specialty finance – all which are core to BC Partners Credit.
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