Discussion about private equity
This is a very interesting podcast about private equity, for anyone who is interested about this.
She has a book about this, which I would like to get at some point.
She is a very reputable investigating journalist, and she talks here about how bad their business model is for any environment other than zero rates, and also some of the sketchy practices she has found that private equity firms do because of the lack of regulation.
I have always been critical of this lack of regulation or transparency, especially for the huge private equity firms, because it inevitable allows all the kind of stuff we know Wall Street is capable of (2008), but in private without any accountability.
She interestingly says that because of this lack of regulation, we know some of these firms are enormous, but we don’t know or recognize how systemic they can be if one of them or several fails. This is because we can’t really understand/know due to lack of data their interconectiness to the financial markets.
However she recognizes banking system at least is now more sound, which is a very positive thing.
I also always wonder if an event could come from here, because this is something no one indeed could see coming. I guess is something we can’t really have any certainly in any direction at all.
