Core Viewpoint - Apollo Global Management's Chief Economist Torsten Sløk indicates that despite the mild inflation data in November, stagflation remains a significant risk for the Federal Reserve in the coming year, potentially threatening the key momentum for stock market growth: the possibility of further interest rate cuts [1] Group 1 - Sløk emphasizes that stagnation inflation is a risk due to emerging headwinds, particularly if artificial intelligence fails to deliver results [1] - He notes that as the new year approaches, economic growth faces downside risks while consumer prices exhibit upside risks [1]

Investment and Market Focus - Apollo Global Management executives discussed the Federal Reserve's rate cut decision [1] - The rise of private credit markets is a key topic of discussion [1] - Data centers and AI are areas of interest for Apollo Global [1] - The discussion includes insights on the economy and private equity [1] Apollo Global Management Personnel - Marc Rowan, Apollo Global Management CEO, is featured [1] - Torsten Sløk, Apollo Global Management partner and chief economist, is featured [1] - John Cortese, Apollo Global Management's co-head of corporate credit, is featured [1] - Stephanie Drescher, Apollo Global Management Chief Client & Product Development Officer, is featured [1] - Scott Kleinman, Apollo Asset Management Co-President, is featured [1] - Michael Downing, Athene (ATH-PA) COO, is featured [1]

Economic Outlook - The market is focused on the implications of the new Fed chair on interest rates, particularly the challenge of convincing other FOMC members to support rate cuts [2][3] - There are expectations of economic growth accelerating due to various tailwinds, including the "one big beautiful bill" and favorable oil prices [4][5] - Inflation is currently around 3%, and there are concerns about maintaining interest rates in a growing economy [6] Employment Trends - Job growth has slowed significantly, with net immigration into the US dropping from around 3 million annually to a projected 500,000 over the next two years [8] - The new equilibrium rate for non-farm payrolls has decreased from 200,000 to 30,000 jobs created monthly due to reduced immigration [9] Risks to Growth - Stagflation is identified as a significant risk, particularly if AI does not meet growth expectations [10] - The construction of data centers has contributed positively to GDP growth, but a slowdown in capital expenditures could pose risks [11] - Inflation remains a complex issue, with various forces at play, and there are expectations of elevated inflation risks in the coming months [12][14] FOMC Considerations - The FOMC is divided on the approach to interest rates, balancing a weaker labor market against persistent inflation risks [15]

Core Insights - Apollo Global Management Inc. is enhancing its risk review process to account for the impact of extreme weather on asset valuations, reflecting a growing concern over the damage caused by floods, storms, and wildfires [1][3] - The firm is expanding its top-down analyses to include more granular, company-level risk assessments before closing deals, as climate-driven disruptions are increasingly affecting operating costs, supply chains, and insurance markets [2][5] Group 1: Risk Assessment and Management - Apollo is implementing deeper analyses of "acute and chronic climate hazards," focusing on loan-level mapping in mortgage portfolios and evaluating exposure to drought, flood, heat, and wildfire in hard-asset sectors [5] - The integration of technology and data availability is allowing Apollo to refine its approach to measuring physical and transition risks, making these assessments a standard part of every deal across all asset classes [5] Group 2: Industry Trends and Responses - The awareness of extreme weather's potential to alter asset values is increasing, with firms like KKR & Co. introducing new credit climate risk models to assess physical risks for new and existing issuers [6][7] - Investors are beginning to recognize the need to assess climate risks similarly to other financial risks, as these can significantly impact cash flows and costs [9][10] Group 3: Market Impact and Future Considerations - A report by MSCI highlighted that 55% of companies in a $2 trillion analysis already face severe physical hazards, affecting sectors such as real estate, insurance, and utilities, leading to higher premiums and lower asset values [10] - The realization that physical risks are already impacting portfolios is prompting investors to adjust their strategies, with a focus on long-term asset holding and the potential for both risks and opportunities in the evolving market landscape [9][11]

Group 1 - David A. Johnson is the founder and principal of Endurance Capital Management, a New Jersey Limited Liability Company, with over 30 years of investment experience [1] - Johnson's investment strategy includes a diverse range of assets such as stocks, bonds, options, ETFs, REITs, real estate, closed-end funds, hedge funds, and private credit [1] - He holds a Master of Science (MS) Degree in Finance with a concentration in Investment Analysis from Boston University, a Certificate in Financial Planning, and an MBA from Fordham University [1]

Core Insights - Apollo-managed funds have agreed to acquire a majority stake in Prosol Group, a leader in fresh food retail in France, from Ardian, with existing shareholders and management reinvesting alongside Apollo [1][3] - Prosol operates nearly 450 stores in France under brands such as Grand Frais and Fresh, focusing on fresh, quality products and a vertically integrated supply chain [2][8] - The investment is expected to support Prosol's growth ambitions both in France and internationally, leveraging Apollo's extensive retail expertise [3] Company Overview - Prosol, founded in 1992, has established a strong customer base through its proprietary supply chain and high-quality product offerings [2][6] - The company operates under multiple retail brands, including Grand Frais, Fresh, La Boulangerie du Marché, mon-marché.fr, BioFrais, and Banco Fresco in Italy [2][8] - Prosol's model emphasizes long-term partnerships with producers, in-house expertise, and a dedicated logistics network to ensure product quality and freshness [7] Investment Details - The transaction is subject to regulatory approvals and is expected to close in Q2 2026 [4] - Apollo has a successful track record in private equity, particularly in the retail and consumer sectors, with approximately €14 billion invested in French companies [3][5]

Core Insights - Apollo Global Management is significantly reducing its exposure to the software industry due to concerns over AI disrupting business models [1][4] - The firm has engaged in short-selling strategies targeting several software companies owned by private equity firms [2][4] - Apollo aims to lower its credit fund's software exposure to below 10% of net assets, down from approximately 20% [3][4] Group 1: Short-Selling Strategy - Apollo's short-selling targets include software companies like Internet Brands, SonicWall, and Perforce, which are backed by large private equity firms [2] - Despite a sell-off in credit bonds earlier this year, these bonds are still trading above 80% of face value, indicating no immediate default fears [2] - The short positions represent less than 1% of Apollo's $700 billion credit asset portfolio and are partly used as market hedging [2] Group 2: Risk Exposure Reduction - Apollo's CEO, Marc Rowan, has communicated to investors that the firm's risk exposure to software companies has been cut nearly in half as they approach 2025 [2][3] - The company has conducted a comprehensive review of software firms to assess potential risks posed by AI [3] Group 3: Concerns Over AI Disruption - Apollo believes that AI's capabilities in automating coding, customer service, and routine financial tasks threaten the survival of many software companies [4] - The firm acknowledges that while AI may present opportunities for some software companies, it has chosen to avoid directional bets in the industry [4] - Blackstone's president has also warned about underestimating the risks of technological disruption, particularly in rule-based businesses [4] Group 4: Valuation Concerns - Historical valuation bubbles in the software sector, exacerbated by a surge in leveraged buyouts (LBOs) from 2020 to 2021, have made high-priced assets particularly vulnerable [5] - With many private credit funds still holding 25% to 33% of their assets in software companies, the potential for a market shake-up due to AI could have significant ripple effects [5] Group 5: Market Reassessment - Apollo's actions may signal the beginning of a broader reassessment of credit markets in response to technological changes [6]

It's that time this hour for our market navigator and with a third consecutive rate cut in the books now question is what impact that will all have on the private equity space. Our next guest says it'll be easier for companies to do their business and bring better returns to investors. He likes some of the names because of that.Bob Lang is founder and chief opt options analyst at explosive options. And Bob, you're looking specifically at Apollo. Why.>> Yeah. Hi Kelly, good to see you again. So I Apollo Glob ...

Core Viewpoint - The recent third consecutive rate cut by the Federal Reserve is expected to positively impact the private equity space, making it easier for companies to conduct business and potentially deliver better returns to investors [1]. Company Analysis - Apollo Global is highlighted as one of the best names in the private equity sector, particularly due to its significant holdings in real estate and diversified areas, positioning it favorably for growth in the coming year [2][3]. - Compared to other major players like Blackstone and KKR, Apollo is seen as having a better equity position and overall advantage, especially with the anticipated lower interest rates [3][4]. - Blackstone, while also holding real estate assets, is viewed as lagging behind Apollo due to its recent acquisition of HOL Logic for $18.6 billion, which required a capital raise that may hinder its performance in the short term [4][5].

Core Viewpoint - Apollo Global Management is considering various options for Invited, including a potential sale or initial public offering, which could value the company at over $3 billion [1] Group 1 - The exploration of options for Invited indicates a strategic move by Apollo Global Management to maximize the value of its investment [1] - The valuation of more than $3 billion suggests strong market interest and potential growth in the golf and membership club sector [1]