Hedge funds and private equity funds got some funding from the Fed, but it won’t be enough to make a dent in the avalanche of deflationary asset values.

cheers,

Leo

It is really a very simple equation:

high leverage + declining asset value = insolvency

These firms will go kersplat at some point unless they get access to outside funding, like through the Fed. I seem to remember that hedge funds got some access to Fed programs. I don’t recall this was the case with private equity. Pleas feel free to correct me if my memory is wrong.

a “deep personal relationship” with the Goldman executive.

I think he already has nine children. Regardless of this and it could just be a cover for improper behaviur, who in their right mind would think moving money from bonds to equities in 2008 was a good idea.
So Carlyle admits that some of its tactics bordered on bribes and kickbacks. The missing link of course is the accusation by Carlyle that they were arm twisted into using Hank Morris’s firm. Not that Carlyle can truely claim inocence after the episode with Karl Rove.
The private equity fund problem could well create a wave of bankruptcies as many of the equity buy out firms they hold are not performing well. Only those funds with a truly long term vision, ratehr than teh asset strippers are likely to survive.

All this just goes to show how much money these firms and politicians really are skimming off. The risk is that it was so rampant that class warfare ensues as it is exposed.