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	<title>Comments on: Private equity - a clumsy trick with too much debt?</title>
	<link>http://ftalphaville.ft.com/blog/2008/04/01/11974/private-equity-a-clumsy-trick-with-too-much-debt/</link>
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	<pubDate>Fri, 29 Aug 2008 22:01:21 +0000</pubDate>
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	<item>
		<title>by: Anonymous</title>
		<link>http://ftalphaville.ft.com/blog/2008/04/01/11974/private-equity-a-clumsy-trick-with-too-much-debt/#comment-16442</link>
		<pubDate>Tue, 01 Apr 2008 23:01:37 +0000</pubDate>
		<guid>http://ftalphaville.ft.com/blog/2008/04/01/11974/private-equity-a-clumsy-trick-with-too-much-debt/#comment-16442</guid>
					<description><![CDATA[http://financialpetition.org/petition-impeach.shtml]]></description>
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		<title>by: VP</title>
		<link>http://ftalphaville.ft.com/blog/2008/04/01/11974/private-equity-a-clumsy-trick-with-too-much-debt/#comment-16437</link>
		<pubDate>Tue, 01 Apr 2008 15:24:51 +0000</pubDate>
		<guid>http://ftalphaville.ft.com/blog/2008/04/01/11974/private-equity-a-clumsy-trick-with-too-much-debt/#comment-16437</guid>
					<description><![CDATA[Am a huge fan of NN Taleb; Fooled By Randomness a v. good book.  

"The most successful traders at any given time are never the best traders".]]></description>
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		<title>by: Anon</title>
		<link>http://ftalphaville.ft.com/blog/2008/04/01/11974/private-equity-a-clumsy-trick-with-too-much-debt/#comment-16436</link>
		<pubDate>Tue, 01 Apr 2008 14:45:50 +0000</pubDate>
		<guid>http://ftalphaville.ft.com/blog/2008/04/01/11974/private-equity-a-clumsy-trick-with-too-much-debt/#comment-16436</guid>
					<description><![CDATA[It's like any boom. What was once an appropriate route for some quoted businesses, eg neglected but solid smallcaps, turned into a mania.

Academics have shown that net of fees, most hedge funds offer little more than beta and sometimes worse, studies show private equity is similar. Yet people lapped up tales of patient management, lean processes and focus on costs to explain private equity success because the narrative fitted the returns available. Nassim Taleb's book puts it succinctly: investors search for a reason to explain under/outperformance. A shame though that supposedly sophisticated investors get hoodwinked.

The question now what happens next: with equity markets falling (exit routes closed), debt costs rising (refinancing becomes more expensive) and a general downturn (pressure on the companies), will the returns generated by leverage now get swallowed up by the deleveraging?]]></description>
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		<title>by: VP</title>
		<link>http://ftalphaville.ft.com/blog/2008/04/01/11974/private-equity-a-clumsy-trick-with-too-much-debt/#comment-16435</link>
		<pubDate>Tue, 01 Apr 2008 14:28:14 +0000</pubDate>
		<guid>http://ftalphaville.ft.com/blog/2008/04/01/11974/private-equity-a-clumsy-trick-with-too-much-debt/#comment-16435</guid>
					<description><![CDATA[Not sure there's much new here; has always been the case since the buyout days of Barbarians at the Gate.

Buy it - gear it - flog it, job's a good 'un.  And when the cycle turns & the debt's unsustainable, it'll be the new owners' worry (pension funds, trackers etc: "not their money").

Made me wonder about the logic of the ideas for SBRY for eg.

Most hedge funds seem to take a similar line - follow the trend, geared.  Some of the gearing on some of the bust ones has been eye-watering.  Shame really, as "true" hedge funds end up with a bad press.]]></description>
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