A year ago we identified four issues for 2024 that would lay the foundations for a Goldilocks era in private debt and private equity: 

1. How a recalibrating market will accommodate the new higher normal for interest rates.
2. Why dispersion between winners and losers looks set to increase.
3. Why portfolio performance will rely on diversification across high quality issuers, industries, and asset classes, combined with alignment with top private equity owners. 
4. How private capital providers’ increasingly sophisticated financing tools will meet the market’s complex needs and generate strong risk-adjusted returns for investors.

It turns out all these factors did contribute to a stellar year for top private capital managers and investors. As we look back at the market’s progress, it’s now evident the macro concerns we had going into 2024 were mostly resolved by year’s end. Rates? Coming down, but not in any rushed fashion. The economy? No recession here (goodbye, inverted yield curve), solid growth, not too hot. Inflation? Pretty tame. Unemployment? Still near multi-year lows.