Historically, regulated banks have provided most of the credit that finances businesses in the United States. However, since the 2008 financial crisis, banks have restricted their credit lines in response to new regulations. In their place has arisen private credit, which comprises direct (and often unregulated) lending, primarily from institutional investors. Estimates peg the current size of outstanding private-credit loans in the US at $1.7 trillion.

This week, Capitalisn’t hosts Bethany McLean and Luigi Zingales sit down with James Grant, a longtime market and banking-industry analyst and publisher of Grant’s Interest Rate Observer, a twice-monthly journal of financial markets published since 1983. Together, they try to answer whether private credit is in the public interest.

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