Oaktree Capital chairman calls today’s markets ‘accommodating’

By Lisa Kerner

Charlotte, N.C., June 10 – Oaktree Capital Group, LLC chairman Howard Marks said he believes that today “the capital markets are accommodating and making it easy to refinance debt and feasible to do risky deals.”

“As a consequence, distressed situations, defaults and bankruptcies are very few,” Marks said during a presentation Tuesday at the Morgan Stanley Financials Conference.

According to Marks, a key ingredient to staying solvent is the ability to roll over debt. He said this is easy to do with the capital markets as they are, “because interest rates have been brought so low investors cannot get the returns they want in Treasuries, money market or high-grade bonds and they’re forced out of the risk curve,” he said.

Marks said the demand for risk assets is high and cash flow into mutual funds is strong, forcing up prices.

“There are many buyers and not too many sellers,” he said. “There’s no distress among holders, no margin calls, no redemptions and thus, no forced sellers. Bargains are few, especially in easy-to-access areas.”

Oaktree Capital is a Los Angeles-based asset management firm.

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