Leveraged Loans: At the Milken Conference

About 4,000 attendees across finance, government, and other fields earlier this week gathered at this year’s Milken Institute Global Conference at the Beverly Hills Hilton to discuss a wide range of topics, though many centered around disruption, whether in a geopolitical, technological, or regulatory form.

The motto of this year’s conference was “Building Meaningful Lives.”

For all the criticism that gatherings like the Milken Conference and World Economic Forum in Davos receive—sometimes written off as self-serving echo chambers for the “global elite”—panelists this year certainly seemed introspective regarding the new political environment.

“A lot of people are hurting out there,” Canyon Capital’s Mitch Julis said, referring to the millions of Americans who’ve lost industrial jobs over the years.

Then again, the conference offered a starkly different experience for attendees. While there were panels that addressed growing inequality, for those looking to indulge a bit there were plenty of opportunities to do so, whether by sitting in the Bombardier Challenger 350 private jet in the parking lot or attending the various parties in the surrounding mansions, including one this year featuring a live cheetah from the San Diego Zoo.

Credit investors certainly exhibited their animal spirits.

Rich valuations, but no immediate signs of a downturn

With the current credit cycle entering its ninth year, market participants, naturally, have been asking how much longer the current cycle can run before the next downturn.

But seasoned credit professionals think such a predefined timeline frames the question in the wrong way, especially given this cycle’s uniquely accommodative monetary policy. A country like Australia, one panelist pointed out, has been in its current cycle for 25 years, though periodically its markets have experienced blips along the way.