What percentage of the private equity industry's returns are attributable to one pe firm selling their assets to another pe firm? Just trading assets all day to make the numbers look good? I've never looked under the hood of a PE-owned company and said "wow, this is well run."
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I don’t know how to comment on that claim bc it literally makes no sense in the long run. long term business are valued on FCF which is what a HUGE portion of the market focuses on including PE. AXTA, Hilton, first data. I’m not saying PE is fairy dust
High-yield debt buyouts in the 80s stopped. We had a tech bubble and it popped. It's possible for private markets to be irrational for a long time. And that's what we could be seeing here.
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I think we are making very different points. Im just saying it’s not some massive Ponzi scheme. People but shitty businesses all the time including in public markets. You’re basically saying growth momentum based investing is a de facto Ponzi
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I don't think high growth companies are bad. Or that companies should be bought on next year's earnings. It's when the losses keep getting bigger with the growth, for many years, but somehow the thing still IPOs like
$BE and countless examples. - 2 more replies
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