Private equity lards up profitable companies with debt to pay themselves and their investors, making those companies less profitable and more likely to fire employees.
Taken together with McKinsey’s “value engineering” and FoxNews, its a cabal that ruined this country.
Amen. Private equity represents the worst side of capitalism. Many private equity folks make grotesque amounts of money acquiring companies - not to build anything positive but to impose cuts, layoffs, and a MBA-style restructuring. Then, they sell the business, pocket undeserved profits, and leave.
I was shocked a few years ago to learn of the practice of vulture equity funds that prey on companies that have gone into administration to pursue directors to get hold of their director liability insurance. No benefit to genuine creditors but pushing up business insurance premiums for everyone
This is how Mitt Romney got richer in the 80s. Taking over companies and selling off assets, people lost their jobs. Makes you wonder why he was ever elected.
Nice! The reality is that we are in the death throws of capitalism in America because our gov has failed to restrain the business world’s worst excesses and now that there is no more capital they can legally force out of people they’re beginning to cannibalize each other.
Many thanks for writing this book. It astounds me how people didn't see this coming after the corporate raiders of the '80s. Look forward to reading it.
The ethos that drives these toxic business and accounting practices is so counter intuitive and anti-social. It's not something that the average person thinks about or engages with.
I was just a Toys R Us yesterday. I bought a B-day gift for my niece. I love that store. I wish I had one near me when I was a kid. I would have practically lived in the Lego session.
Privatizing heathcare during the Nixon Administration is how it got to the disaster it is today. That's what they want to do with Social Security and Medicare. Hell no !!
Sadly, PE has/is purchasing most retail brands, racking them up with debt, and then scrapping out the carcasses (e.g., JoAnn). Eventually, there will be only two places to shop: Amazon and Walmart.
This seems fascinating. The new American dream isn’t to create wealth and uplift communities it’s to extract wealth like oil and toss away the carcass to be dealt with by someone else. Horrible.
After reading Gretchen Morgenson’s book “These are the Plunderers” we’re going to need more books on this topic to understand what’s really happening behind all of these parasitical private equity vampires….
They are gamblers and too many of them BORROW money to gamble it on companies that should never be investments in the first place. 23andMe, Ancestry, Gedmatch, are PERSONAL SERVICES that were never meant to capitalize off their customer's use of the service. Until private equity firms ruined them.
I've seen some of this close up in the tech world. It's toxic and demoralizing. We're well on our way to becoming full-on serfs in a digital feudalism society.
It’s so sad that it’s ALREADY happening so rampantly in the tech sector when the field is so young. I think there’s a misconception that this is largely only happening to “older” established businesses that are failing.
There’s even a line for people who worry (reasonably!) that the book is too depressing to read These Days: “Such stories outrage, but Greenwell finds reason for hope in ordinary people pushing back against private equity’s worst abuses.”
Been saying this for years. Once I found out what really happens in the process. Heck “going public“
and having to satisfy stockholders being the primary goal for any company – rather than great service or products – that too has taken us down.
Private equity killed JOANN fabrics, despite the fact that crafting and sewing is on the rise since the beginning of the pandemic. Just make a quick profit.
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Taken together with McKinsey’s “value engineering” and FoxNews, its a cabal that ruined this country.
It never ends well
Prison/Jails Privitize
Medical Offices
All Public Funds ForProfit
Thank you👍
https://www.mobilize.us/mobilize/event/751091/
Oligarchy is the sickness.
Thank you for more information!
perpetuated by the wealthy to get workers to work harder for a goal they can never attain
and having to satisfy stockholders being the primary goal for any company – rather than great service or products – that too has taken us down.
In Life
Peoples of the World
need to understand this
They relaxed annual minimum taxes. AMT exists to make sure the exorbitantly wealthy still pay taxes (min %).
That "relaxation" (IMO grant) allowed the rich to monopolize & buy up necessary services & move into private equities.