Jean Boivin

The massive AI infrastructure buildout requires unprecedented investment, forcing the world to leverage up. Private credit is a big beneficiary with a structural tailwind, playing an even larger role in funding this transformation. The asset class is positioned for growth, and we like public and private credit with clear cash flows.

"It's not the stagflation or shock that... would be a risk and that would be more like if we're in months of 200 plus." Equity markets often sell off aggressively during oil shocks due to fears of 1970s-style stagflation (high inflation combined with stagnant growth). However, because this specific shock is not severe enough to materially destroy global growth (which would require $200+ oil), any broad market sell-off driven by stagflation panic is a mispricing. LONG broad market indices to buy the dip during periods of peak geopolitical and stagflationary panic. The inflation bump forces central banks to hike rates further, which could compress equity valuation multiples even if a deep recession is avoided.

"It's not the stagflation or shock that... would be a risk and that would be more like if we're in months of 200 plus." Equity markets often sell off aggressively during oil shocks due to fears of 1970s-style stagflation (high inflation combined with stagnant growth). However, because this specific shock is not severe enough to materially destroy global growth (which would require $200+ oil), any broad market sell-off driven by stagflation panic is a mispricing. LONG broad market indices to buy the dip during periods of peak geopolitical and stagflationary panic. The inflation bump forces central banks to hike rates further, which could compress equity valuation multiples even if a deep recession is avoided.

"It's going to add to an inflation narrative which is going to challenge the benign inflation narrative that been prevalent before." Even a short-lived spike in energy prices will bleed into headline inflation data over the coming months. This will force the market to re-price inflation expectations higher and price out aggressive central bank rate cuts. As inflation expectations rise, long-duration bond yields will increase, driving bond prices down. SHORT long-term Treasuries to capitalize on the shift away from the "benign inflation" narrative. The energy shock causes an immediate recessionary contraction, leading investors to flee to the safety of long-term bonds despite the inflation bump.

"I don't think the world can sustain months of 100 plus dollar and people will react to that. So I think that's why... we're in a realm of weeks." The market tends to extrapolate short-term geopolitical shocks into long-term supply deficits. Because the global economy cannot tolerate $100+ oil, extreme price spikes will catalyze rapid interventions (political, military, or economic) to reopen shipping lanes. Therefore, fading extreme upward spikes in oil prices will be profitable as the disruption normalizes faster than the market fears. SHORT oil via USO on panic-driven spikes toward $100, playing the reversion to the mean as supply chains normalize in weeks. The conflict escalates beyond a regional blockade into a direct, prolonged war that physically destroys oil infrastructure, making a quick resolution impossible.