One thing I’ve noticed—while everyone is worried about geopolitical risks, a quiet crisis is brewing within the U.S. financial system that looks like it could become as big as 2008. This time, the protagonist is the private credit market—and it’s starting with $260 billion in funds.

Look at last week’s events. BlackRock announced it would limit its large corporate lending fund’s redemptions to 5%—when investors demanded to withdraw 9.3%. This isn’t just a technical move. It means that if everyone had to get their money back, they would have to sell assets on a large scale—and those assets are not available in the market. Three weeks ago, Blue Owl Capital had already begun selling $14 billion worth of assets. Now, Blackstone’s private credit fund has received a redemption request of 7.9%—the legal limit is 7%.

This is the vicious cycle that was also seen in 2008. When investors pull out money out of fear, managers have to sell. Selling drives prices down. Falling prices make more people want to withdraw their money. The cycle comes to a halt.

Blue Owl’s stock has now fallen below its SPAC launch price of $10. And this is just the beginning. Blue Owl has a $36 million exposure with London-based company Century Capital Partners, which has just gone bankrupt. PIMCO—which is a major investment firm—has issued a clear warning in its new report: private credit will now face a “full cycle default period.”

Here’s the interesting part. The private credit market is considered semi-liquid—that is, you can withdraw your money quarterly. But the underlying assets are long-term private loans of 5-10 years. This mismatch has always existed. Now it’s just coming to the surface.

PIMCO analysts pointed to three main issues: first, regulations have been loosening continuously since 2008. Second, heavy investment in software companies—now falling due to AI. Third, investors are not being offered enough returns to lock their money in for so long. This is a $1.8 trillion market. And it is now facing a stress test.

The question is: will this repeat 2008? Structurally, yes, all signs point to it. But this time, at least, we are seeing warnings in advance.