Blackstone’s share price is getting savaged right now, KKR is having similar issues, as is US Foodservice (when it comes to floating issues) and many of the senior players in the bridge financing business are increasingly reluctant to “play along” with the big PE and hedge fund players.
Much like the LBO frenzy of the 1980s, at some point the party comes to a close and the bill comes due. If we are not at that point, we are darn close.
The more things change, the more they stay the same. And, as bad as some of this dealmaking is, I would prefer to keep government and legislators out of the market. You’d just be trading one evil for another. Much of the dynamism found in our market is due to exactly this kind of buccaneering behavior. Is it prone to excess? Yup. Is it always bad? Nope.
