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The rise of private equity siphoning off all gains before they dump it on the public, is breaking the public markets and skimming from all investors. The idea
by drawkbox 7y ago
The rise of private equity siphoning off all gains before they dump it on the public, is breaking the public markets and skimming from all investors.
The idea of public markets was trusted investments and the ability to gain with early companies. Now those gains go to the early private investors, then they shine that turd after the growth is tapped to sucker the public market longs into giving them more runway. Usually once the growth is tapped out they now dump it on the public markets.
But the system still works a bit, public markets and SEC requirements expose fraud and overvaluations.
When the whole of America revolves around the public markets, and so many forces out there trying to break them like private equity shovel companies, naked short selling, short and distort via large hedge funds, planned volatility and more. I wonder when the public markets will break, because that is when America breaks as well. You'd think the SEC would step in more. They are a bit on short and distort [1] and did on naked short selling after the Great Recession (3 day after the Sept 15th cliff) [2]. All of those forces are back with a vengeance.
[1] https://www.sec.gov/news/press-release/2018-190 https://www.sec.gov/news/press-release/2018-190
[2] https://www.sec.gov/news/press/2008/2008-204.htm https://www.sec.gov/news/press/2008/2008-204.htm
- AznHisoka 7y ago"Usually once the growth is tapped out they now dump it on the public markets." While this has been true for recent IPOs like Uber/Lyft/WeWork, there also has been many other IPOs where the companies have continued growing even after they IPO. Recent examples include Twilio, Hubspot, Docusign and Tableau.