2 ms·
Private equity just means controlling a company outside of the public stock markets, it is incredibly broad, and covers everything from blackrock buying every v
by dghlsakjg 5d ago
Private equity just means controlling a company outside of the public stock markets, it is incredibly broad, and covers everything from blackrock buying every vets office in an area, to a plumber buying out another plumber when they want to retire.
The steelman argument is that private equity is just property rights. If I build a business I get to decide what to do with it.
What most people are arguing against is a specific kind of PE where an institutional investor will either use aggressive financial engineering to force a profit, even if it kills the business, or when those same investors aggregate market share to the point where it is detrimental to consumers. Sprinkle in a little bit of heartless MBA bullshit, and that is what people specifically don’t like.
- caminante 5d agoIt is a broad term. VC is a subset of PE. In medicine, it's a solution for someone who wants liquidity (buy kids new home, help local dog shelter, add a new mistress) and doesn't want to retire, yet. The problem is that the terms are custom and YMMV as an existing patient of said practice.
- holmesworcester 5d agoA stronger steelman is that it results in resources getting allocated in smarter/healthier ways across society. If there's some business that's getting by but the land it's on is more valuable (e.g. for housing) than the business, some investors buy the business, sell the land, make the business account for the land value, wind the business down if it can't, and there are apartments there a few years later.
- dghlsakjg 5d agoIs that not just a subset of this: > The steelman argument is that private equity is just property rights. If I build a business I get to decide what to do with it.
- viccis 5d ago>If I build a business I get to decide what to do with it. I don't think that follows necessarily, especially not categorically.
- BrenBarn 5d ago> The steelman argument is that private equity is just property rights. If I build a business I get to decide what to do with it. You're gonna need to steelman that again, because in and of itself that is also not something I see as desirable.
- dghlsakjg 5d agoTo be clear: You don't think it is desirable to be able to do what you want with your own property? If you can't allow property rights then there is no way to steelman people exercising property rights.
- BrenBarn 5d agoI think that "everyone should be able to do what they want with their own property", per se, is not a good principle for society. Sometimes people should not be allowed to do what they want with their property. In particular, I think the more property a person has, the less freedom they should have to do what they want with it. (This can also take the form of "the amount of property a person can own should be limited".)
- mizzao 5d agoBerkshire Hathaway is in some sense also PE (though done by a public company that you can invest in) and Warren Buffett's culture is to find great companies run by great managers and let them cook. That long-term view is the exception and not the rule though.