KKR's Weinstein on Distressed-Debt Investing Strategy

The transcript discusses the current state of credit markets, highlighting the availability of credit and potential future risks. It explores distressed opportunities, market conditions, and the impact of quantitative easing. The discussion includes an analysis of maturity profiles, refinancing activities, and sector-specific insights into energy and retail. The transcript also covers the dynamics of the coal market, differentiating between metallurgical and thermal coal.

What is a significant challenge for opportunistic investors in an environment with abundant credit availability?

• High interest rates

• Limited investment options

• Marginal credit decisions

• Excessive regulation

According to the transcript, when is the best time to invest in distressed opportunities?

• When credit is easily available

• When fear levels are high

• When stock prices are at their peak

• When interest rates are low

What has been the primary driver of financing activity in the loan market over the past year?

• New issue driven for M&A

• Government bonds

• Refinancing activity

• Equity financing

Which sector has seen the majority of default activity in the past 12 months?

• Retail

• Healthcare

• Technology

• Oil and Gas

What is a key factor in evaluating retail companies for investment?

• Location of headquarters

• Advertising budget

• Number of employees

• Store footprint and earnings power

What has caused the recent price surge in metallurgical coal?

• Government subsidies

• New mining technologies

• Reduction in production in China

• Increased demand for thermal coal

What is a long-term challenge for thermal coal?

• Decreasing demand for electricity

• Rising oil prices

• Secular issues and shift to cleaner energy

• Increasing steel production