Bloomberg Surveillance: Apollo's Jim Zelter on Market Structure, AI, and Inflation

Redefining Market Structure

• 💡 Jim Zelter of Apollo Global Management argues that the era of free money and ultra-low interest rates is over, with inflation now being structural, not transitory.
• 🎯 The traditional 60/40 portfolio is being re-evaluated, with a growing need to augment past strategies with alternatives for better outcomes and less volatility, especially for global retirees.
• 🔑 Companies like SpaceX and Stripe are staying private longer, indicating a shift in how capital is accessed and deployed, moving beyond the rearview mirror of past market structures.
• 🚀 The distinction between public and private markets is shifting from risk to liquidity, challenging the historical notion that private markets are inherently riskier and less liquid than public ones.

The Evolving Role of Private Capital

• 📈 Over the last 30 years, high-yield markets financed companies undergoing regulatory or technological change; now, massive capex is driven by data, AI, and sustainability.
• 📊 Private credit is poised to have a significant impact over the next decade, potentially larger than private equity's impact in the last, with 80-90% of the private credit market involving investment-grade counterparties.
• 🧩 Private equity is expected to undergo a