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The author makes it sound like PE has taken over public pension investments. But while participation is wide (about 85% of public pension funds have some privat

The author makes it sound like PE has taken over public pension investments. But while participation is wide (about 85% of public pension funds have some private-equity investments), it's not particularly deep (9% of public pension funds, nationwide, are in private equity). Across a 10-year study released in 2021, PE was the best performing asset class held by public pensions, with an average return of more than 12%. And they need those returns. We can debate whether PE is good or not, but it's not debatable that states, collectively, owe ~$1 trillion in unfunded pension liabilities -- in fact, it's the biggest obligation most states' balance sheets. They need to close that gap via higher returns or higher taxes. Final point: This is an anonymous piece so we have no way to track the credibility of the author, his or her biases, etc. If it's the truth and you stand by it, put your name on it.

rektide 4y ago
Putting "making money" as the sole & overriding decision making factor is a recipe for bad things. The article spends a relatively brief amount of time bashing the massive wealth extraction PE does. It barely talks about all the businesses it wrecks as it uses leverage to saddle companies with debt. Does ruining companies justify an additional 1.2% return for a pension? It doesnt dwell overly long on how ridiculous the fees & perposterous expenses seem to be. That money seems needed by the pensions. In all, this article just sets the stage for thr very reasonable thing the FTC seems to be asking for: a little bit of sunlight into where the money goes, what the fees & expenses are. This modest ask isnt trying to turn back what seems all to often to me to be (& gently cited within as) a buch of looting corporate hooligans; an illegitemate Billionaire Factory of no good or real public utility except wealth extraction. Right now there's few indicators it's the pensions that get helped, and both the fees/expenses & cost to society/general economic health are unknownable.
xrd 4y ago
The URL includes Matt Stoller, which is his name. He's author of a book about monopolies called Goliath. He's well known, at least to me.
- aidenn0 4y ago
  From TFA: > Today’s issue is written by an anonymous guest-author. It’s about the emergence of the financial model currently ruling America, which is known as private equity, and why there’s finally a regulator at the Securities and Exchange Commission willing to crack down on the industry Hopefully the author is not anonymous to Matt, but it's not actually written by Matt.
  - xrd 4y ago
    Doh, right! I recall reading that now. Thanks for clarifying.
  - hgsgm 4y ago
deleted 4y ago
[deleted]
lotsofpulp 4y ago
> Across a 10-year study released in 2021, PE was the best performing asset class held by public pensions, with an average return of more than 12%. How does that compare to a risk adjusted return and of taxpayers investing in VOO or any other broad market low cost index fund instead? And how are the expense ratios for PE funds versus index funds? > They need to close that gap via higher returns or higher taxes. I trust the federal government to close that gap via higher returns, mostly by not being afraid to decrease the purchasing power of USD.

rektide 4y ago

Putting "making money" as the sole & overriding decision making factor is a recipe for bad things. The article spends a relatively brief amount of time bashing the massive wealth extraction PE does. It barely talks about all the businesses it wrecks as it uses leverage to saddle companies with debt. Does ruining companies justify an additional 1.2% return for a pension? It doesnt dwell overly long on how ridiculous the fees & perposterous expenses seem to be. That money seems needed by the pensions. In all, this article just sets the stage for thr very reasonable thing the FTC seems to be asking for: a little bit of sunlight into where the money goes, what the fees & expenses are. This modest ask isnt trying to turn back what seems all to often to me to be (& gently cited within as) a buch of looting corporate hooligans; an illegitemate Billionaire Factory of no good or real public utility except wealth extraction. Right now there's few indicators it's the pensions that get helped, and both the fees/expenses & cost to society/general economic health are unknownable.

xrd 4y ago

The URL includes Matt Stoller, which is his name. He's author of a book about monopolies called Goliath. He's well known, at least to me.

aidenn0 4y ago
From TFA: > Today’s issue is written by an anonymous guest-author. It’s about the emergence of the financial model currently ruling America, which is known as private equity, and why there’s finally a regulator at the Securities and Exchange Commission willing to crack down on the industry Hopefully the author is not anonymous to Matt, but it's not actually written by Matt.
- xrd 4y ago
  Doh, right! I recall reading that now. Thanks for clarifying.
- hgsgm 4y ago

deleted 4y ago

[deleted]

lotsofpulp 4y ago

> Across a 10-year study released in 2021, PE was the best performing asset class held by public pensions, with an average return of more than 12%. How does that compare to a risk adjusted return and of taxpayers investing in VOO or any other broad market low cost index fund instead? And how are the expense ratios for PE funds versus index funds? > They need to close that gap via higher returns or higher taxes. I trust the federal government to close that gap via higher returns, mostly by not being afraid to decrease the purchasing power of USD.