Retailization of Private Credit: Systemic Risk Implications of Semi-Liquid Vehicles and 401(k) Integration Post-Executive Order 2025

Version 3.0 (2026-08-19). This revision measures the retail private-credit channel loan by loan for the first time and reports one result that weakens the paper's own primary test. Layer D is new: a pre-registered N-PORT panel of 26 quarters, growing from 6 funds and USD 4.2 billion to 31 funds and USD 75.6 billion, in which the value-weighted payment-in-kind share of the retail private-credit universe rises from 0.915 to 3.883 percent (p = 4.6e-5) and reaches 15.494 percent among the funds that use the flag at all - because funds flagging no PIK whatever are 70 to 96 percent of universe value across the panel. In the same panel the N-PORT default flag is shown to be unusable as a sector stress measure: a single filer supplies between 45 and 100 percent of all flagged default value in every quarter, and its identity changes. That is a measurement-validity result about a public dataset rather than a finding about credit. Against the paper's own interest, the primary in-sample cascade-ordering test is shown to turn on one press-derived input. The deposited version reported that Blackstone Private Credit Fund fulfilled 100 percent of a 7.9 percent redemption request; the fund's filings disclose a 7.0 percent repurchase above a Board-upsized cap and no tendered-share count, so the fulfilment figure is press-derived. Substituting the filing-verified 7.0 percent moves the Spearman statistic from +0.363 to +0.286 at p > 0.05, which is FAIL rather than AMBIGUOUS under the same pre-specified rule. A fund-liquidity figure is also corrected: Blue Owl Credit Income Corp covered its capped redemption 4.3 times from USD 4.25 billion of disclosed fund-level liquidity, not 6.3 times from USD 11.3 billion. The pre-registered Layer-C forward test on the Q3 2026 redemption window remains unrun and its lock is unamended, so this paper still contains no identified out-of-sample result. This is the first code deposit for this paper. What the text below no longer describes accurately. The 7.9 per cent figure for Blackstone Private Credit Fund that appears below is press-derived; the fund's filings disclose a 7.0 per cent repurchase above a Board-upsized cap and no tendered-share count, and substituting the filing-verified figure moves the paper's primary cascade-ordering test from AMBIGUOUS to FAIL under the same pre-specified rule. Separately, the Version 2.8.1 paragraph below states that the Layer-C pre-registration lock is anchored to this concept DOI and to a Research Lab Git-mirror commit. Two corrections: the lock was not in fact present in any file of the version that paragraph describes - it ships for the first time in this version, at prereg/ - and the Git mirror it names does not exist, so this Zenodo record is the sole timestamp anchor. The lock itself is shipped unamended, byte-for-byte, and is not modified by this revision. The earlier text is left standing unedited as the record of what those versions said. The manuscript's own title in this version is: Retailization of Private Credit Revisited: Three Private Substitutes for the Public Backstop in the Q1 2026 BDC Cascade - and a Pre-Registered Forward Test. The record title above is retained unchanged so that the concept DOI keeps a stable citation string across versions. Version 2.8.1 (2026-06) — pre-registration lock-in patch. The Layer-C forward-test pre-registration lock-in DOI, previously marked 'forthcoming', is now instantiated: the immutable pre-registration (vulnerability-score formula, test statistic, null distribution, decision rule) is anchored to this deposit's Zenodo concept DOI 10.5281/zenodo.20095776 and the Research Lab Git-mirror commit. No results or numbers change. (Residual internal version/process annotations are being removed progressively in subsequent revisions.) Version 2 (paper v2.8, 2026-06) — major revision of the v1 deposit (v1 remains citable at its version DOI). (1) The v1 thesis that an absent public backstop implies T_retail approximately 0 with catastrophic amplification is revised: the realized Q1-2026 non-traded-BDC redemption episode was absorbed in roughly six weeks via private substitutes (sponsor capital, prospectus gating discretion, legal pro-ration), with no fund failure. (2) The time-series contagion statistics (DCC-GARCH persistence 0.967, Forbes-Rigobon adjusted correlation 0.43, Diebold-Yilmaz connectedness 68%) are reclassified as v1 post-hoc characterizations — correcting a v1 conflation of the DCC persistence with a correlation level — while the paper's own v2 inference (Spearman with a 10,000-permutation null, p=0.110; bootstrap CI; simulated power MDE80=0.65; cross-sponsor joint-saturation Monte Carlo P(≥2) approximately 86%) is fully reproduced by deterministic, seeded code. Honest epistemic-status framing throughout. Extends the K-A-T framework to retail distribution channels. Three formal propositions: (i) retail funding constraints amplify procyclically through behavioral contagion and information asymmetry (K_retail); (ii) redemption cascades in semi-liquid vehicles create amplification mechanisms structurally analogous to bank runs but without deposit insurance (A_retail); (iii) absent lender-of-last-resort implies near-zero policy backstop (T_retail ~ 0). Empirical analysis on novel SEC EDGAR XBRL panel of 10 publicly-traded BDCs (138 quarterly observations, 2020-2025), plus event-snapshot data for non-traded vehicles. The March 2026 gate wave (BCRED 7.9%, HLEND 9.3%, Cliffwater 14%) yields Forbes-Rigobon adjusted correlation 0.43 (rejecting no-contagion at 1%), DCC-GARCH persistence beta = 0.967 (half-life 36 trading days), and Diebold-Yilmaz connectedness 68.0% (ARCC dominant net transmitter +12.6pp). Placebo: semi-liquid BDC connectedness 75.6% exceeds daily-liquid ETF 64.5%. Proposes Retail Private Credit Gateway (RPCG) regulatory framework: mandatory liquidity buffers (15-20% NAV), standardized valuation disclosure, ERISA-compliant suitability, FSOC designation authority for systemically important semi-liquid vehicles.