US Markets in 2026 - Risks and Opportunities

Welcome to day two of our investor webinar, Finding Value in Volatility.

I hope you enjoyed day one and we're now ready for a few more jam-packed sessions.

First up today, we start with our keynote speaker, Michael McCarthy, CEO of MooMoo ANZ.

Moomoo is Australia's most downloaded trading app and part of Fudu Holdings, a Hong Kong-based Nasdaq-listed global financial institution.

Michael is responsible for Moomoo's growth and with a focus on empowering local investors to access global markets.

Delighted to have you here, Michael, and I'd like to hand over to you for your session.

That's very kind, and thank you for those kind words, Darren.

It's great to be here, and I'd like to thank all of the viewers for joining us for today's session.

And today I'm going to be looking at the US markets and the reason for that is clear.

One of the value propositions Moomoo brings to Australia and New Zealand is that access to international markets at a reasonable price and the focus for a lot of our Australian and New Zealand customers is those US markets.

It's a large part of our daily turnover and it's a focus for many Australians now that access is available at a reasonable price and reasonable convenience.

So turning to the US markets now.

Generally as you can see this presentation is called U.S. Markets, Risks and Opportunities 2026 and in the normal course of events I would focus on the opportunities while also being aware of the risks but given the situation in markets at the moment and I'll explain a little more once we've got through some important information but given the situation in markets today I'd like to focus on the risks.

I think that's going to be an important part of the coming weeks and months.

and something all investors should be very aware of.

But before we start there is some important information.

All of the information in today's presentation has been prepared without any regard to your personal situation and as investors and traders we all come to the market with differences.

We have different goals, we have different levels of experience and knowledge.

We have different amounts of capital and we have different risk appetites.

And all these differences mean that the right answer is as much a function of you and your circumstances as it is of the markets.

And so whether or not any of the information presented today is of any use to you is a decision entirely for you.

Now there's plenty more information as you can see on the screen.

Moomoo Securities is a ASIC regulated body and our financial services license number is on the screen there.

We do contain a lot of information about risks in investment and trading on our website.

You can look that up, but if you still have some doubts, please seek independent advice.

Now with that in mind, let's turn to today's presentation.

Today I'll be looking at the four intertwined threats that I think are a real risk for the US share market this year.

I'll speak about why things are more dangerous than they have been for some time because the safety net that has backed up markets and economies for so long is now being withdrawn.

But we'll look at the positives too and we'll look at why the US market in particular has performed so strongly up until recently and then we'll look at some of the strategy, the investment strategy implications of the possibilities for the rest of the year.

But one of the reasons I'm so focused on risk in the markets at the moment is what I'm seeing across markets.

Now, having been fortunate enough over a multi-decade career to trade every asset class, by habit, I watch every asset class to see how they work together.

And those of you who've read Michael Lewis's lies poker might recognize the description that the global markets are like a giant web.

And when one thread is plucked,

The vibrations go around the world and that's what I'm seeing happening at the moment.

I'm seeing signals from bond markets, from short-end interest rate markets, from currency markets, from cryptocurrency markets.

to some extent from share markets that are all lining up with the same message and that message is growth is slowing and interest rates are headed higher.

Now bond markets are reflecting that here in Australia the 10-year bond has broken through the 5% mark and is trading higher again.

In the US we're seeing real pressure all the way along the bond curve with the 10-year bond touching 4.4%

very recently and the 20 and 30 year bonds approaching 5%.

Now these are the highest levels we've seen for US bond interest rates for a long time and they're sending a signal but it's not just those markets.

Looking at gold for example and the big fall we've seen there from those highs at 5,600 an ounce to touch 4,100 an ounce in a matter of weeks.

Now this sort of volatility, these huge moves and the fact so many markets are now sitting

key support levels suggest that we could be in for a bit of a rough ride.

So let's start by having a look at some of the risks in the US market at the moment and these are the four that I'd like to touch on today.

With those four risks in mind let's turn to the first one and that is war in the Middle East and the big problem coming out of the Middle East relates to that impact on oil prices.

The actual war itself is stimulatory and in fact for a lot of US companies

it presents a real opportunity for their bottom line.

But the big problem for the global economy is the impact that it's having on energy markets and in particular the blockading of the Straits of Hormuz means bad news for the world.

Almost a fifth of the daily production of oil comes through those Straits from the Persian Gulf.

It's where many of the Middle Eastern countries ship from and many have no alternatives and the blocking of

of the straight means that that oil supply is trapped.

Now that story we know storage facilities around the region are already full.

So production is now halting and we know that damage has been done to oil infrastructure that will take months if not years to repair.

So no matter what happens if we were to get an outbreak of peace today we're still going to see upward pressure on energy prices generally and oil prices in particular but of course it also impacts the byproducts of that oil production.

So we're talking about fertilizers

and we're talking about plastics and so every just about every production chain around the globe will be impacted by this big push upward in prices in energy markets and so this is a stimulatory effect in terms of inflation pushing up the inputs to production means we push up the output prices or

businesses go out of business.

So this sort of impulse will take a while to feed through the global pricing, but there's no doubt it will be inflation.

We're already seeing that acknowledged.

Here in Australia, the Treasurer has acknowledged that inflation is likely to rise to 5% by the middle of the year.

A number of analysts in the US have pointed out that even if the war in the Middle East were to finish today, inflation in the US is headed over 4%.

And those sorts of levels are important.

We'll get into that in a moment.

But alongside this big push upward for prices and the inflationary impact that's going to have, we've got this slowing of the global economic system.

and the drag that's being introduced by oil shortages and fuel shortages and fertilizer shortages are going to weigh on global growth.

So we've got a scenario where inflation means we've got rising interest rates, central banks must respond to this rising inflation.

At the same time, the lack of energy supplies is likely to drag on the global economy and that means less activity, that means less sales and that means less profits.

And so this combination of a double hit, a drag on growth and a push upward on interest rates brings us to the S word and that is stagflation.

Now the reason that economists fear stagflation is because it literally rips economies to shreds.

Slowing growth and rising prices and a potential inflationary spiral can destroy economies.

We saw it in the Weimar Republic in Germany in the 1930s.

We saw it in Zimbabwe in 2009 where the country had to abandon its currency and give up all hope of managing its economy, eventually dollarizing their economy to stabilize it.

Inflation is an economic

powerhouse that will destroy economies and it's why central banks are so focused on it and if it occurs with slowing growth and we get stagflation, the dislocations could be very severe.

Now that is the extreme scenario.

Not many analysts are calling for that extreme but it is a real risk right now and it's something investors should be aware of.

And the last point I'd like to hammer home about this war in the Middle East is that the damage is already done.

We've already seen infrastructure destroyed.

We've already seen the wheels come off a lot of production in the Middle East and for that reason, as I say, we are months and possibly years away from a full recovery in global energy markets.

So this is the most prominent risk at the moment.

It's certainly grabbing the headlines but it's not the only risk we face as investors and traders.

And one of the big risks that existed before this outbreak of war in the Middle East was the impact of rising inflation and the implications for interest rates.

I've mentioned before that an inflationary spiral, once it starts up, is very destructive.

The interest rates that it drives are the continental plates of the financial world.

Everything sits on the interest rate structure and whether it's the borrowing of governments by the bond markets or whether it's currency markets which are driven by interest rate differentials, whether it's companies borrowing for their bottom line or individuals borrowing to buy homes, the interest rates that are set

drive almost every economic activity and so they're essential to it and they're a blunt tool and they're one of the few tools available to central banks to help in their finance inflation.

It's often said central banks only have two tools one is an interest rate a very blunt instrument and the other is the jawbone in other words how they talk about markets and economies can have an impact as well.

So with them really only having this one hard lever to push on

it's almost certain as we see that inflationary impulse that interest rates are going up around the world.

Now bond traders have already acknowledged this.

I mentioned in the intro the pressure that we're seeing on the long end of the bond markets.

It's also happening in the short end and you might have heard a lot of talk in the past about the interest rate markets and the probability of interest rate cuts that they were pricing previously.

Well in the US that short end of the interest rate market

now pricing no cuts at all.

In fact, it's got a slight tilt towards rate increases.

So, in the US, interest rate traders have changed their view.

Just two months ago, they were pricing two and a half rate cuts over the course of this year.

Now, they're saying no interest rate reductions at all in the US this year and I would argue that share markets around the globe and share markets in the US in particular are yet to price that change in this

base level driver of economic activity.

That change in the outlook for interest rates is very important and we'll look at some of the reasons why that is but the bond markets are sending a very clear message which in my view

equity investors have not yet received.

So another one to watch out for and of course any bad news in terms of higher inflation rates or any bad news in terms of actual rate increases from central banks could be the trigger for share market sell downs as the reality of tighter interest rates and tighter monetary policy come to the forefront of investors' minds.

The third threat I'd like to talk about today is artificial intelligence and I chose this picture advisedly.

Now I'd like to point out that artificial intelligence is actually nothing new.

In financial markets we've been using algorithms to perform tasks since at least the 1990s and back then it might have been called black box trading and in the 2000s it might have been called algorithmic trading.

but the idea was the same.

So artificial intelligence is a scary name that's been given to a practice that we've been using for a long time.

Having said that, it's now reached a level of sophistication where artificial intelligence applications have the ability potentially to reshape the world.

And so we're having a lot of discussions in equity market circles around the impact of AI.

And while clearly there are some winners in the AI circle, there are also some losers.

The winners of course include the chip makers who provide the chips that run these very memory intensive processes.

But it also includes groups like the energy companies who supply the power to the data centers that run AI.

We've then got the hardware suppliers and those who supply the equipment.

We've got the other resources that feed into that, including things like copper, which is required to wire all of these buildings.

And then we've got the large language

learning models and these models are what make AI give it its capabilities and then of course at the very top level of the AI stack we've got those actual applications those agentic AI applications that individuals and companies use to perform tasks for them so those five levels

artificial intelligence mean that there are winners and losers but of course one of the groups that have been identified as a potential loser out of the introduction of artificial intelligence is software companies and the perception being that people will now be able to get an AI agent to perform a lot of the tasks and do a lot of the coding that was involved in the sale of software particularly software as a service previously.

So there are some real concerns

about some of the businesses that could go out of action.

We're already seeing evidence of that with locally, Atlassian laying off a lot of staff in recognition that the demand for their labor is now on the decline.

So artificial intelligence, still very important, still very powerful.

It's not new and the implications are yet to be made clear.

And as we work our way through 2026, we'll get a better view of just what the potential risks and benefits

of artificial intelligence are.

And then the last of our risks is the one that's quite hidden.

And this is concerning because it's pretty rare in looking back over economic history that the seeds of the most of the coming disaster in markets were created in the previous disaster.

Normally as a human race, we learn a lesson.

And so the idea that credit markets could once again trip up the global financial system

is particularly concerning.

Now the idea around private credit is quite straightforward.

It's a disintermediation argument that is that larger borrowers who are well known can go directly to investors cutting out the banks and the other institutions that might in the past have sat between these two groups and lend directly to the borrowers and the idea being to take out that middle layer so cutting costs for borrowers and increasing returns for lenders.

And it's one of the reasons this idea of access to better returns and the exclusivity that's been cultivated by private credit purveyors has really fed into a bit of a frenzy for people to get into private credit markets.

There's been an explosion of interest in these markets.

Now the concern is with all of these different finance silos going into the area, that if something goes wrong, the knock-on effects to the broader economy could be very, very damaging.

And the problem here is we're already seeing signs of distress.

Now it's widely thought that the most likely source of that distress is the large software companies we were just discussing a moment ago, because their business model is under threat from AI,

They've got very substantial borrowings and most of it is unsecured and so this private credit lending to large software groups and we saw, we've seen over the last few months even after the interest in AI was whipped to a frenzy, we've seen some come to market for tens of billions of dollars and now what you're seeing is fund freezes.

And the world's largest fund manager, BlackRock, has a specialist fund.

They've limited withdrawals.

Blue Owl, one of the biggest private credit groups, has also frozen redemptions in one of its funds and others have introduced 5% limits on withdrawals from these private credit funds.

Now that in itself is not causing things to fall over but it is a sign of distress.

It's certainly an indication of a lack of confidence and a lot of investors are now seeking to get their funds back and are unable to do so.

And of course if we continue to see credit failures and fund freezes in the private credit markets, it won't be long before that spreads to other lending markets.

So we're watching the developments in private credit markets very carefully at the moment because it's coming at a terrible time.

Just as we're facing a conflagration in the Middle East, as we're looking for that inflationary impact and the higher interest rates that are very likely to come with it and as we see that drag on global growth, the last thing the world needs is a credit crisis.

And so this combination of factors is very concerning.

The big concern is that they're all intertwined, that they'll feed into each other.

So that war in the Middle East and the impact it's having on energy markets is feeding straight into those concerns about interest rates and inflation.

Now let's be clear, we'll worry about inflation before the war in Iran.

This only adds to the danger.

It seems to make it more certain that we're going to see higher interest rates around the globe.

And in a similar way, the concerns about artificial intelligence and the impact it'll have on some industries are feeding into the private credit concerns that we have.

So these are intertwined risks and that's what makes them more concerning.

And that's why I'm more concerned when I look at the charts and I see so many markets on what I would suggest is the brink.

And that's why I'm focused today on the risks in markets at the moment.

I think the responsible thing to do is being very aware of risk at the moment.

Now that doesn't mean curling up like a snail into your shell or hiding away or diving under the doona, but it does mean taking action to ensure that your portfolio is in good shape no matter what happens in the markets.

All of these concerns have been raised before, let's be frank, but the big issue for markets now is the safety net we've relied on previously has now been withdrawn from 2008.

economies and markets were backstopped by central banks and governments.

Central banks lowered interest rates and they flooded the global financial system with money and that liquidity and the low cost of money meant that a lot of stress was taken out of the financial world and at the same time

governments enacted stimulus policies, they started spending, they started building, they started getting money flowing through their economies by starting the process themselves and that combination of monetary support from the central banks and fiscal support from governments not only got us through the GFC but then became a tool that many countries have relied on again and we saw during the COVID lockdowns exactly that response again and

To a large extent, at least in the short term, those measures were effective in 2009, 2010, and they were effective again in 2021, 22.

The problem is that they short circuit one of the keys of the capitalist cycle, and that is the cycle of creative destruction.

Now, creative destruction sounds like a contradiction in terms, but the purpose of allowing companies to go broke is it frees the resources those companies have been using inefficiently.

releasing those resources to potentially more efficient users is part of the capitalist cycle.

And yet when banks and, sorry, central banks and governments rushed in to stop that part of the cycle, they stopped that redeployment of resources.

And that's built in efficiencies up in the system.

And it's one of the reasons why we were already worried about inflation.

It does look like the central banks have lost some grip on that, that the flow of money and the cheapness of it, the low interest rates,

has now fed into the global economic system and is pushing prices.

And with inflation on the rise, central banks are no longer in a position to support economies.

They will risk recessions rather than allow an inflationary spiral breakout.

So inflation ties the hands of central banks.

They're no longer able to help.

And the big problem with that is

governments have been borrowing for so long to stimulate their economies that their own balance sheets are now making that more and more difficult.

In the US, total government gross bond issue is $35 trillion.

So 35 trillion US debt has never been higher.

This is as high as we've ever seen in history.

And that in itself is starting to introduce a constraint on the growth

in the US economy because the interest bill alone is now measured in trillions and it's a similar situation in many countries around the world.

Here in Australia, we've got estimates that government debt will hit the trillion dollar mark by 2028.

We're certainly heading in that direction at the moment with deficits as far as the eye can see.

And so once again, this higher level of debt to begin with means if another crisis emerges globally or locally, it's very hard for governments to continue to step up given the amount of spending and the amount of debt that they already own.

And this is what I mean when I say there is no safety net.

Neither governments nor central banks are well positioned to ride to the rescue if the worst comes to worst.

And if it does, they might be inclined to let the economies and the markets go

to get through the crisis.

Now having said all that and looked at all those risks we'd have to acknowledge that up until recently share markets were at all-time highs and the US market last year as measured by the S&P 500 hit new all-time highs more than 50 times last year.

How are share markets rising given all these risks some of which have been around for months or even years?

And the reason they've been able to do it is the earnings growth we've been seeing across the US.

Now I'm looking at sales growth and profit growth for companies at the index level.

These are the averages, but the overall shape of the economy is driven by how every company is affected.

from just looking at the first column here in the fourth quarter of 2025 sales for the S&P 500 companies on average across those 500 companies was up 9% plus and not only did they get a good increase in sales over the quarter but they got a big increase in profitability more than the growth in sales suggesting that there were productivity increases as well.

Now these numbers are not additive by the way, we're looking in the first column at the quarterly performance in the fourth quarter and the comparison is for the previous quarter.

On the annual growth side we're looking at the performance for the full year 2025 against the full year 2024.

So these are not additive numbers but you can see even on that longer run basis in the S&P 500, sales grew at around 5% last year and profitability was up more than 11% echoing that

increase in sales and increase in productivity and when we zero in on the Nasdaq 100 which has more of those more glamorous tech companies you can see the numbers are even more impressive whether we're looking at the quarterly sales and profitability or that incredible numbers for the annual growth 9% growth in sales translating to a 24% increase in profitability we can see why

there is some justification for the lofty levels of share prices we're seeing at the moment.

The reason for it is that study after study has shown that the one factor that best predicts share price movement is earnings revision.

When analysts are revising their estimates of earnings for a company upward, the share price tends to go up.

And when they're revising their earnings estimates downwards,

it tends to go down.

Now there are no guarantees in life and nothing is 100% in markets but study after study shows that it's that earnings revision that best predicts movements in share prices and that's why this profitability and this productivity increase

has been such a driver of highs for the share market because on the way we've seen a lot of revisions upward as new industries are explored, new products are rolled out and new markets are opened and that growth that comes.

and the scalability, particularly in those tech companies where the incremental cost of production is low, meant that there has been at the company level, some justification for the lofty levels we've seen.

So although we do very significant risk in the market at the moment, it's not showing, or it has not yet shown up on the bottom lines of companies on average, but what we might be about to see as interest rates change, as the sea changes in markets,

is that growth in profitability turned downward.

And if analysts start revising downward their estimates of company profitability, we could see the share market take the same direction.

So something to be aware of.

So how can investors respond?

Well, as I mentioned at the very top, the right response depends very much on an individual investor's situation as it does the market.

So the right way to respond depends very much on you and your circumstances.

The best time to prepare for stormy weather in the market is when the sun is shining.

In fact, that's the second best time.

The absolute best time is when you devise your initial investment plan.

Now the reality is a lot of people feel that way into markets.

When they first start investing, they don't know a lot about markets and they don't have the experience or the knowledge to devise a comprehensive investment plan.

And that's okay.

That's part of the investment journey.

But as investors become more and more experienced or they work with good advisors,

They should be looking at an investment plan.

An investment plan should take into account that there is regular pullbacks in the market.

A lot of people seem to be aware that the share market can offer superior returns.

The risk and reward ratio, the relationship between risk and reward means those higher rewards available in the share market mean that there are also higher risks.

And what I believe we're about to go through as a market and what may have already started

we're going to have one of those periods where we experience the risk of owning shares having seen the rewards over the previous couple of years.

So the best time to prepare is at the very beginning when you devise your investment strategy the next best time to prepare is when the market is going very well and conditions are calm and the third best time is now because it's never too late to act.

So

We should expect there will be regular pullbacks in markets and we should be investing and trading with those ideas in mind at all times.

However, there's a risk management tool that's available to every investor no matter their level of sophistication or the amount of capital they have available and that is diversification.

Now this is a key investment tool that I think is often neglected because it is right in front of all of us and in fact most people diversify without even thinking about it.

But when we think about diversity, it's not buying

another tech stock or it's not moving into another sector buying a bank or a resource stock.

It's not just that we can certainly diversify within industries and within a share market but true diversity in a global investment environment means diversifying across asset classes having property and bonds having other sorts of investments in the portfolio as well as shares local shares international shares diversifying by geography diversifying by currency

diversifying across industries.

One of the main drivers for Australian investment in US markets has been that ability to access industries that are not well represented on the local exchange.

So diversification is a very important tool.

The right way to diversify once again depends very much on the individual circumstances but the concept remains diversification is a risk management tool we can all use.

They're the main points that I'd like to cover off from today.

As I say, I tend to focus more on the stocks that might represent opportunities.

So I won't leave you without saying that what I'm looking for in stocks at the moment and what I'm diversifying into is stocks that have strong balance sheets.

They're well placed to survive crises and might even be able to take up opportunities if markets and economies do weaken.

Stocks and companies that have low debt.

beneficiaries in this environment.

Those with higher debt are imperiled.

Clearly their cost of servicing that debt are very likely to go up and the potential for that to imperil their business is very real.

So low stocks and companies with low debt I believe will become more attractive this year.

Steady cash flows and reliable cash flows are also going to I believe increase in attraction in investment markets.

investors look for saver havens.

So if for example we're looking at the retail sector my suggestion would be the supermarkets are likely to enjoy a better share market ride than say luxury retailers because in a environment where interest rates are rising and growth is slowing consumers are also likely to be impacted by this change in the environment and pull their horns in spending more on the essentials and less on luxury goods.

I'd also look for stocks in the current environment with higher dividends.

Cash flow will be important and higher dividends are likely to make a stock more attractive.

And what this means for a lot is that we'll be looking at more mature businesses.

So that's what I'm looking for.

Strong balance sheets, low debts, steady cash flows and higher dividends.

So rather than looking at individual stocks today, they're the characteristics I'm using to identify investment targets in the near term.

Thank you very much for your attention today.

I suspect that we might have a couple of questions coming through.

Is that right, Darren?

It is, Michael.

It's been quite a far ranging scheme across markets and risks and issues and the strength of corporate earnings, which I think is a good point to remind people about.

You did mention that central banks and governments don't have the same capacity to backstop

markets the way they did post GFC.

How should an individual investor consider their position?

How should they act given that fact?

Well there are a number of potential reactions for individual investors and as I say the right response depends very much on the individual investor circumstances but certainly cutting debt

personal debt if possible or if it's not possible to reduce debt to at least fix some of it so that if interest rates continue to rise they won't be affected.

Anybody who's employing leverage in their investing might want to examine the levels of leverage that they're using and consider reducing any leverage that they might have in the current environment.

That could be a source of pain if interest rates continue to go higher.

I think too that

If people have bonds or interest rate exposures as part of their investment portfolio, looking at shorter dated maturities might be wiser.

As we go out long in the curve, there are capital risks as interest rate rises.

If we borrow a bond and it's yielding 5% and interest rates then go to 7, the capital value of the bond falls.

Now that might not be a problem if you're prepared to hold it for 10 years, but if you do need liquidity,

you might want to start reducing the longer term exposures and I guess the overall issue when markets and economies slow is cash.

So perhaps increasing cash levels, one that gives more of a buffer should something go wrong in another part of the portfolio but two

It means if markets do fall substantially, having cash in the portfolio leaves an investor in a situation where they can take advantage.

So they're just some of the suggestions for action that investors could take right now.

Thank you, Michael.

You also flagged, well, AI is, apart from the war, maybe the second most largest headlines in media at the moment.

And we've seen a lot of the interest in AI manifest itself through the MAG-7 in the US.

Are there ways for investors to get access to that growth without necessarily taking on all of that concentration risk?

One of the fascinating things about the Magnificent Seven, Darren, has been the diversity in the share price performance.

So Meta is down around 24% since last September.

At the same time, Google or Alphabet is up something like 22%.

So there's been a huge divergence.

in the performance of the Magnificent Seven, which means that for those who think that Meta has opportunities in AI, they might want to look at those stocks that have been underperforming lately.

But I'd also speak to that stack that we talked about and looking at all five levels of the AI stack.

And at the moment, we're certainly seeing frothy valuations amongst some of the creators of the agentic AI applications and frothy valuations in the semiconductor space.

Areas where there might not be

as much froth are things like copper miners producing copper mines that will benefit from the increased demand from copper.

Uranium miners have had quite a wild ride and some of these are very volatile and investors should do their own homework of course but getting exposure to AI doesn't necessarily mean buying a chip maker and those five levels of the AI infrastructure mean that there

often ways for investors to gain exposure to the power of AI without actually buying directly into an AI company.

And probably Michael, maybe if we just finish off on one more topic that is making headlines, which is private credits, not always for the right reasons if you're an investor in any of those funds, but for retail investors who may not be quite as familiar with this part of the market, what should they be watching out for?

Well this is one of the times where we have to watch the headlines and I don't often recommend that.

Headlines can be a real source of noise in the markets and often misleading but the big problem with private credit markets comes from one of the things that's been pushed as its main attraction, that exclusive nature of them and the private nature of them means that very little detail is available.

So as an investor myself, what I'm watching is those big private credit firms.

I mentioned Blue Owl earlier.

I mentioned Black Rocks Fund.

There are a lot of them.

You can look them up quite easily on most platforms under thematic investing, private credit markets.

But these companies have exposures.

And so I'm looking out for their announcements and in particular, their fund freezes.

As somebody who traded through the GFC, I must admit this keeps me awake at night.

Because, as I say, the big problem in 2008 was the freezing of credit markets.

And if there starts to be significant risk coming out of private credit markets, and there's a freeze on, then we could see a real acceleration in some of the risks that we've been talking about today.

Watch the headlines to see what's happening with private credit and watch those private credit companies and what they're doing with their specialist funds because we really don't have much of a view into the private credit markets.

And maybe Michael we cross our fingers and hope that the perfect storm or the potential for the perfect storm passes us by.

Well we've ridden it out pretty well for the last couple of years Darren so as I say these are risks they don't necessarily come to fruition but it's important investors are aware of the risks when they put their hard-earned money to work in the markets.

And always remain diversified Michael I think that's the one of the key takeaways.

Absolutely it's a tool we can all use.

Thank you, Michael.

Thank you very much for your insights and expertise and experience over markets.

That was a very illuminating session and I think one that the audience will find valuable.

Thanks for having me on, Darren.

Appreciate it.