Private Credit: This Cycle’s Crisis?

Market analyst Michael A. Gayed of The Lead-Lag Report has highlighted potential vulnerabilities in the private credit sector, drawing parallels with past credit crises. In a post that has gained traction on X, he noted that many private credit loans were underwritten during an era of near-zero interest rates and oil prices around US$60 a barrel.

“Oil is now US$112. Rates are staying higher for longer. The assumptions that justified those loans no longer exist. Nobody is talking about this.”

Accompanying the post is a chart titled Private Credit: This Cycle’s Sub-Prime? showing the market’s rapid expansion.

The private credit market grew from roughly US$0.7 trillion in 2018 to a projected US$1.7 trillion by 2026, according to the data plotted. A vertical line marks the 2022 rate-hike period, after which growth continued, with a red annotation on the right highlighting “Oil at $112”. A footnote on the chart states that most loans were underwritten at near-zero rates and US$60 oil. That could also spell trouble for energy-intensive industries such as logistics and manufacturing. Broader industry forecasts for 2026 put private credit assets under management above US$2 trillion.

Gold Plunges Nearly 10% in Worst Weekly Performance Since 2011

In a separate but timely development, gold has suffered a sharp correction. The metal has fallen nearly 10% this week and is on track for its worst month since October 2008. It is another striking echo of the GFC.

Futures recently traded around US$4,575 an ounce after the sell-off. Despite the steep decline, gold remains up more than 5% year to date in 2026. Market participants have attributed the pullback to profit-taking, volatility linked to oil shocks and geopolitical developments, and ongoing distortions in paper markets.

The combination of elevated oil prices, persistently higher rates and asset volatility is drawing fresh attention to hidden leverage across credit markets, as well as the traditional safe-haven role of precious metals during periods of uncertainty.