Investors like Friedman, who make the most money when companies are in trouble and need cash, have had relatively little to invest in given years of markets gaining in value.
"That's where all of us probably agree the opportunity is: When it goes down, you have to buy whatever you can," Carey Lathrop, head of global credit markets at Citi, said, speaking alongside Friedman and other hedge and private equity fund investors.
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Indeed, investors who manage huge pools of private capital have so much money saved up they almost can't wait for the markets to fall.
The problem, according to Apollo Global Management's Joshua Harris, is there may not be a broad selloff of assets like in 2008, making post-crash investing opportunities more difficult to find.
"I don't unfortunately believe it's going to be that simple this time around. You're going to have to be much smarter and opportunistic about how you play industries, regions and other things," the $160 billion private equity firm's co-founder said on the same panel that focused on investing in companies in financial trouble. "I don't think you're going to have this broad-based pullback."
The good news, Harris said, is that a 2008-type market crash is less likely given all the large investors waiting to jump in.
"There's many more institutional players. They sort of sit there and they wait for any opportunity," Harris explained, giving the example of investing in energy following the drop in oil prices. "The plus side is that the system won't really break down like it did in '08."