Jonathan Lewinsohn – Credit Microcycles at Diameter (EP.484)

Jonathan Lewinsohn, co-managing partner of Diameter Capital Partners, provides a credit market update, focusing on industry microcycles and private credit. Lewinsohn highlights the evolution and current state of private credit, distinguishing between direct lending and capital solutions, and points out the risks associated with industry concentration, particularly in software. He emphasizes the importance of analyzing return on invested capital to identify good businesses, even within distressed sectors like housing and telecom. The conversation explores the impact of technological transformation and policy volatility on creating microcycles, as well as the growing role of insurance companies in the investment-grade market. Lewinsohn stresses the need for macro awareness in credit investing and the significance of being a repeat player in navigating creditor dynamics.