Investors are selling stocks to buy new IPOs which is dangerous, says Ariel's Charles Bobrinskoy

• Investors are selling existing stocks to fund 'hot, sexy IPOs,' a dangerous trend.
• Concerns about crowding out in leveraged lending and private credit, with companies issuing 'pay-in-kind' debt, indicating insufficient cash flow.
• Record trillion-dollar government deficits are creating short-term economic tailwinds but long-term inflationary pressures and capital scarcity.

Charles Bobrinskoy expresses extreme nervousness about the current market, citing a 'crowding out' phenomenon where capital is chasing risky, hot IPOs and leveraged lending. He warns that this behavior, coupled with record government deficits and tight credit spreads, could lead to significant market trouble, drawing parallels to the 1989 United Airlines LBO failure.