“When you see one cockroach, there are probably more…” So said Jaimie Dimon, CEO of JPMorgan Chase, after last year’s sudden, multi-billion dollar collapse of Tricolor and First Brands shined a spotlight on the murky world of private credit. Dimon summed up the panic spreading throughout the whole Epstein class: that these bankruptcies indicate a much deeper rot within the economy.
2026 is proving these fears correct. “Cockroaches” are popping up left and right, sparking huge withdrawals from private credit funds which some are comparing to the early days of the 2008 financial crisis.
Why should workers care if wealthy investors and asset managers lose their money gambling on private credit? We have no sympathy for these swindlers, but private credit is so entangled with the rest of the economy that it could trigger a much broader crisis.
American and European banks have lent $4.5 trillion to private credit firms and other non-bank lenders. 89% of public-sector pension funds have investments in private equity, meaning 34 million public sector workers rely on these speculators to keep body and soul together in retirement.
In total, 62% of Americans own stocks, either directly or indirectly through retirement accounts like 401(k)s or IRAs, including 28% of households earning less than $50,000 a year. A financial crisis would devastate the stock market and wipe out a significant chunk of these savings. Ultimately, it’s the working class that will foot the bill for the impending disaster caused by the billionaires’ reckless drive for profit.
Rise of private credit
The ruling class claimed to have learned their lesson from the 2008 crisis. Lawmakers and regulators put safeguards and regulations on banks to limit predatory lending and excessive speculation.
But the market has a logic of its own. It wasn’t long before investors found ways around the guard rails in the form of private credit. Private lenders, such as Blackstone, Apollo, Ares, and Blue Owl raked in billions by issuing opaque, high-risk loans that aren’t subject to the same rules as traditional banks.
Until recently, these firms were seen as generally stable—and extremely lucrative. But the collapse of Tricolor and First Brands served as a stark wakeup call. Fears were compounded by the February collapse of UK-based Market Financial Solutions amid allegations of fraud, leaving investors over $1.4 billion in the hole. Foreseeing a wave of defaults on private loans, investors have been clamoring for their money back, attempting to withdraw over $10 billion and counting from private credit funds.
Alarm bells sounded. Companies frantically tried to stop the outward flow of money. Blue Owl was the first to react, limiting cash withdrawals last November and doubling down further in February by ending its schedule of quarterly payouts. Other firms quickly followed suit. Apollo and Ares capped withdrawals at 5% last month, as did the private credit arms of Morgan Stanley and BlackRock.
Parasitism and decay
Fund managers need to cap withdrawals for one simple reason: They don’t have enough money to pay out.
In the murky world of private credit, reliable statistics can be hard to come by, but analysts estimate the value of the private credit market is anywhere between $1.8 and $3 trillion. But this wealth is wrapped up in market speculation. It is a reflection of the fact that it is no longer profitable for capitalists to invest in the production of real goods and services. With each passing day, billionaires become more and more parasitic and detached from the creation of real value.
The caps on withdrawals are backfiring, further stoking the mood of panic among investors, who are ever more desperate to disentangle their money from private credit. The value of Blackstone stocks dropped 46%, Apollo 41%, and Blue Owl a whopping 66%. Private credit firms lost $265 billion worth of market value in this process. It’s easy to see why the bourgeois media is adopting an almost apocalyptic tone, with headlines such as “Is Private Credit the Next Financial Crisis?”
Combine the warning signs in private equity with the AI bubble and economic shocks from the war in Iran, and a sobering picture emerges: an economy careening towards collapse.
As the deluge of articles from the business press shows, the billionaires are keenly aware of this reality. But they are unable to stop it. The logic of the capitalist system necessitates the continued accumulation of profit. Laws and regulations cannot tame the anarchy of the market. Only the working class, united under a militant, class independent banner, can strike the death-blow of capitalism. It is we who bear the brunt of the capitalist crises, and collectively, it is we who have the power to stomp out all the cockroaches once and for all.