Fear Is on Sale and So Is Blue Owl Capital
Oct 30th, 2025
The market has gone and scared itself silly again. Credit headlines turned gloomy, Jamie Dimon muttered the words “private credit risk,” and before you could say “floating rate loan,” investors started dumping anything with the word “credit” in it. The panic spread faster than gossip in a high school cafeteria. But here’s the thing. The fear is overblown. The opportunity is real. This is one of those rare times when the market throws perfectly good cash flow machines out the window just because everyone got spooked by the shadows. Let’s talk about why this correction is built on nerves, not numbers, and why firms like Blue Owl Capital (OWL) are now sitting in the sweet spot for those of us who like to get paid while others panic.
The market has gone and scared itself silly again. Credit headlines turned gloomy, Jamie Dimon muttered the words “private credit risk,” and before you could say “floating rate loan,” investors started dumping anything with the word “credit” in it. The panic spread faster than gossip in a high school cafeteria. But here’s the thing. The fear is overblown. The opportunity is real. This is one of those rare times when the market throws perfectly good cash flow machines out the window just because everyone got spooked by the shadows. Let’s talk about why this correction is built on nerves, not numbers, and why firms like Blue Owl Capital (OWL) are now sitting in the sweet spot for those of us who like to get paid while others panic.
Three things hit at once. First, a few regional banks like Zions and Western Alliance announced loan write downs and legal troubles. That was all it took for the market to imagine a credit apocalypse. But a couple of bad apples do not mean the orchard is on fire. Second, Jamie Dimon said “private credit” out loud. The JPMorgan chief warned that the two trillion dollar private credit industry might be getting frothy. When a man with that much gray hair and gravitas says “risk,” the herd hears “run.” Third, the IMF waved a yellow flag. The International Monetary Fund warned about “disorderly market corrections” and overvalued assets. Investors promptly lost their composure, ignoring that the IMF has been warning about something every month since the dawn of time. Add in higher long term rates, tighter credit spreads, and some wobbly economic data, and you have yourself a recipe for fear stew.
Yes, credit conditions are tighter. Yes, borrowers are paying more. But this is not a crisis. Defaults remain historically low. Corporate profits are still covering interest expenses. And the leading private lenders like Blue Owl are not the ones borrowing money, they are the ones lending it at higher yields. Blue Owl’s portfolio is filled with senior secured loans, the kind that get paid first when things get messy. Many of these loans have floating rates, which means every rate hike boosts the company’s income. The fear trade assumes that all lenders are about to be crushed, but the truth is that many are thriving. In short, the market is reacting to fear of what could happen rather than what is happening.
Blue Owl is not some speculative plaything. It is a cash flow fortress run by professionals who get paid to structure deals that keep paying through thick and thin. The firm manages over 175 billion dollars across credit, real estate, and GP financing, and much of that income is locked in through recurring fees. Even after this correction, Blue Owl’s fundamentals have not cracked. The company continues to grow assets under management as institutions pour into private credit. It generates steady, fee based cash flows that do not depend on daily market moves, and it pays a dividend north of five percent, backed by real earnings. When you strip away the market noise, what is left is a reliable toll bridge, one that keeps collecting traffic fees while the rest of the world panics about weather reports.
This moment reminds me of the old Munger line: “The big money is not in the buying and the selling, but in the waiting.” Right now, the market is selling first and thinking later. That gives long term investors a gift. You are getting a chance to buy a durable, cash generating business at a discount. In a few quarters, when sentiment swings back and everyone realizes Blue Owl did not collapse, they will rush back in. The same fear that pushed the stock down will push it right back up.
At Income Charlie, we do not chase hype. We buy cash flows that survive storms. The market is having a panic attack, but the cash coming from Blue Owl’s portfolio is steady, rising, and real. This is the kind of setup we live for, high yield, temporary fear, and a strong business model underneath it all. The crowd is running from the credit markets as if the bridge is collapsing. We are walking calmly onto the bridge and collecting the tolls they are too scared to take.
My take: Buy Blue Owl while it is cheap. Let the market hyperventilate. When the fear passes, and it always does, you will be left holding a steady stream of income and a smile.
