Ares Capital's DeVeer on Fed's Powell, Credit Markets and Private Equity

The transcript discusses market expectations and volatility due to potential rate hikes by the Fed, led by Powell. It explores the impact of the yield curve on credit businesses and economic growth, emphasizing the importance of strategic capital deployment in volatile markets. The conversation also touches on economic cycles, central bank activities, and investment strategies focusing on growth and defensive industries.

What was the market's initial reaction to Powell's stance on rate hikes?

• The market was optimistic and bullish.

• The market was surprised and volatile.

• The market was calm and stable.

• The market was indifferent.

How does a flattening yield curve typically affect economic growth?

• It discourages economic growth.

• It stabilizes economic growth.

• It encourages economic growth.

• It has no impact on economic growth.

What is one reason for the abundance of capital in private equity markets?

• Low interest rates.

• High interest rates.

• Government intervention.

• Stable market conditions.

What is a common strategy for managing capital in a high-valuation environment?

• Investing in small businesses.

• Avoiding investments altogether.

• Investing in high-risk ventures.

• Focusing on defensive industries.

What is the expected impact of gradual rate increases in 2018 according to the discussion?

• It will have no impact.

• It will lead to a market crash.

• It will be welcomed and needed.

• It will destabilize the market.

What is a potential consequence of high valuations in the market?

• Decreased risk-taking behavior.

• Increased investor confidence.

• Stability in market prices.

• Nervousness among investors.

What is a sign of late-cycle behavior in the credit market?

• Strengthening of loan documentation.

• Increase in market covenants.

• Weakening of loan documentation.

• Decrease in market covenants.