The private credit crisis that's about to crush tech (and nobody sees it coming)

Deutsche Bank hit new lows this morning.

BlackRock locked out redemptions on their private credit funds.

Morgan Stanley just did the same thing.

And I'm sitting here thinking: does anybody understand what this means for tech?

Let me connect some dots for you.

Who do you think is financing all these AI data centers?

"Here's a few billion dollars. Go build yourself a data center."

Who's doing that? A lot of private credit. The same private credit that just locked everyone out.

I've been in these credit markets. I have millions of dollars in some of these debt positions. If I tried to close out right now, I'd take a massive haircut. There's no liquidity in these markets. None.

Now imagine you're a multi-billion dollar fund like BlackRock. You've got billions in these illiquid credit instruments. People want their money back, but you can't get out without getting slaughtered.

So what do they do? Lock out redemptions. "You can have eleven dollars." Even if you need your money, you can't get it.

Here's the part nobody's connecting:

Companies like OpenAI? They've got plenty of money, but they're not using their money. They're using credit. Where are they getting that credit?

Private credit markets that are now locking people out.

CoreWeave, all these data center companies - where do you think they're going for financing when this dries up?

This isn't staying contained to finance.

I don't think this is about banks. The banks aren't using their money - they're using your money. You're gonna lose your money. The bank might take a dent, but they'll survive.

But what happens to the tech companies when the financing for data centers disappears?

Look at Deutsche Bank on a 15-year chart. When you see something that steep on a 15-year timeframe, there's trouble brewing.

These private credit funds were supposed to give retail access to illiquid debt markets. Pool your capital, get into credit markets you couldn't access alone.

Problem is, when you want out, they can't sell the underlying positions.

The domino effect is starting.

Deutsche Bank has been involved in every damn scandal - they should've been shut down years ago. Now they're leading the charge downward.

The financing that's been fueling the AI boom? It's drying up fast.

And when companies can't get the credit they need to build out infrastructure, guess what happens to their stock prices?

Any tech company heavily dependent on debt financing for expansion. When this credit crunch really hits, they're going to get hammered.

The connection between Deutsche Bank's collapse and your favorite AI stock? It's closer than you think.

Which AI companies are most exposed to this credit crunch? I've got the full breakdown of who's vulnerable right inside the TheoTrade Chatroom.

To your success,

Don Kaufman

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The private credit crisis that's about to crush tech (and nobody sees it coming)

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