Lessons from fixed income market structure

Welcome back to the Alt Goes Mainstream podcast.

Today’s episode takes us to a hub of market structure, a powerhouse of trading, and a crossroads of public and private markets to discuss how private markets are in the midst of a market structure evolution.

We sat down at Bloomberg’s NYC headquarters with Bloomberg’s Head of Fixed Income & Private Markets Brad Foster to discuss how technology and data are driving a convergence between public and private markets, particularly as it relates to the credit space.

Brad is the Head of Fixed Income & Private Markets at Bloomberg, where he’s focused on delivering the data, analytics, and tools clients need to power public and private market investment strategies and workflows. Brad joined Bloomberg in June 2017 to lead its Enterprise Data Content business as well as its Fixed Income Evaluated Pricing (BVAL) offering. He was appointed Head of Fixed Income, including Securitized Products, in early 2023 and Head of Fixed Income & Private Markets in early 2024. Prior to joining Bloomberg, Brad spent almost 20 years on the sell-side in multiple locations, including London, Tokyo, and New York, for Deutsche Bank as a Managing Director in Global Markets across Global Finance, Fixed Income & Currencies, Structured Finance, Special Situations, Structured Lending and Front Office Risk Management, including CVA and Counterparty Risk, where he managed a team that built a Cross-Product Risk and Portfolio Margining Platform. Prior to Deutsche Bank, he was at Credit Suisse in the Market Risk Management Group.

Brad and I had a fascinating conversation about public and private credit and how data and technology are shaping these markets. We covered:

• How Bloomberg’s history shaping other market structures are informing how private markets market structure is evolving.
• How public and private credit are converging.
• Definitions and perspectives on liquidity vs illiquidity, what’s risky and what’s not risky.
• What private markets needs from a market infrastructure perspective to scale.
• Why borrowers are choosing private credit and the investment grade private credit option.
• How Bloomberg is approaching private credit and private markets market structure.
• Bloomberg’s build vs. buy vs. partner strategy with private markets tech.

Thanks Brad for sharing your wisdom, expertise, and passion at the intersection of credit, market structure, and financial technology.

Show Notes
00:00 Scaling Private Markets

01:12 Welcome to the Alt Goes Mainstream Podcast

02:13 Brad Foster’s Background

04:31 From Trading to Bloomberg

05:27 Client Empathy Product Mindset

06:25 Fixed Income as Blueprint

07:11 Bloomberg Shaping Market Structure

08:19 Electronification Turning Points

09:10 Efficiency and Regulation Drivers

09:45 Blurring Public and Private Credit

10:34 Three Legs of Credit

11:43 Why Borrowers Go Private

13:09 Missing Data and Workflow

13:57 Security Master Foundations

16:12 Transparency and Retail Pressure

22:07 Private Deal Data Uploads

22:29 Same Analytics for Private

22:50 Sold Not Bought Debate

23:43 When Private Gets Liquid

24:38 Desktop Real Estate Idea

26:21 Reimagining Terminal with AI

27:21 Chat as Market Connector

28:19 Build Buy Partner Strategy

28:51 Bloomberg Private Track Record

30:09 Daphne Investment Rationale

30:58 Fixing GP LP Workflow

32:01 Most Valuable Data Masters

33:45 Taxonomy as Missing Piece

34:49 Standardizing Valuation Methods

35:29 Extending Evaluated Pricing

37:27 Liquidity Versus Illiquidity

40:18 Portfolio Risk for Asset Owners

44:16 Foundations to Scale Privates

Editing and post-production work for this episode was provided by The Podcast Consultant.