Winner in 2008’s Big Short Unveils Bearish Private Credit Play

Lee Robinson shorted the subprime mortgage market in advance of the 2008 financial crisis, turning $20 million into $200 million. For that, the Brit was not portrayed in the hit film The Big Short, which focused on his American short-selling brethren. He did, however, witness the real-life version of the Deutsche Bank housing market presentation famously dramatized by Ryan Gosling as a Jenga game heralding economic catastrophe.

Now, Robinson’s angling for a role in the sequel. He told Bloomberg News his investment firm, Altana, is launching a fund that’s designed to protect against a downturn in the private credit market and includes short bets against life insurers like Lincoln National, MetLife and Berkshire Hathaway with exposure to the $1.8 trillion sector.

Trading Places

As you’ve by now read more times than Archimedes could count, private credit investors are in cash-out mode this year. Rising redemption requests have forced major fund managers BlackRock, Morgan Stanley, Blue Owl, Apollo Global, and Cliffwater to impose caps on withdrawals. Industry champions note the caps are designed to protect investors from a fire sale, and regulators have said they don’t view private credit as posing a systemic risk. But that hasn’t fully satisfied concerns about defaults, valuations and exposure to the AI-vulnerable software industry, and so the redemption requests keep rolling in.

Among the biggest backers of private credit are life insurers, attracted by the higher yields on debt issued by non-bank lenders. Earlier this month, Moody’s said US life insurers’ $807 billion of private credit and illiquid assets at the end of 2025 represented a fifth of their combined fixed-income portfolio, up from 18% a year earlier, “raising risks owing to weaker credit quality.” So shorting insurers as a proxy bet against private credit is fit for Altana’s bearish appetite. Robinson has been open about this trade for a while now, but there are signs it’s gaining steam:

• He told the Financial Times in April that Altana held credit default swaps that will pay out if US life insurers exposed to private credit fail to meet their obligations. What’s new is the fund, which will include Altana capital but allow others to get in on the trade.
• But it’s not just Altana: Bloomberg reported that Wall Street firms, including JPMorgan Chase and Goldman Sachs, have been responding to client requests for financial products that protect against private credit risk.

Another Way to Play: S&P Dow Jones Indices launched a credit default swap index linked to the private credit market in April, allowing investors to bet against the sector.