We could see IG credit spreads in the 60s, something many haven't seen in their career. This is due to corporate bond scarcity, not improving fundamentals. The government is borrowing much more than the corporate sector. Half of US debt is private, half government; 10 years ago it was 2/3 private, 1/3 government.

You have to go back to the 1960s (guns and butter, Vietnam War) to find a similar dynamic. That's also when spreads were really tight.

Not yet. Tech is issuing a lot but experiencing extremely rapid growth. Other parts of the economy (transportation, consumer discretionary) are issuing way below historical trend. The tech market answers to itself at the moment, allowing the market to absorb it.

The economy is K-shaped, and that's true for the credit market as well.

The critical issue is monetization of all the investments. If AI monetization cannot be realized, the equity market has a problem, and the economy relying heavily on capex tailwinds will also have a big problem. That's the biggest recession risk.

SpaceX is unique but broadly in the hyperscaler space. The interesting question is to what extent companies start to rely on the equity market for funding growth, as we saw with Alphabet and IPOs. This would be healthy, spreading funding more evenly across equity and credit.