The US is in the midst of a “credit bubble”, according to Leon Black, co-founder of private equity behemoth Apollo Global Management.

He said aggressive pricing for loans such as the non-performing loans banks are trying to offload from their balance sheets could be an indicator of a bubble, in which cheap availability of loans and lax covenants have overloaded the economy with debt, but predicted that a downturn is likely to be avoided by a period of “turbo-charged” economic stimulus.