Comment Re:Old news (Score 1) 39
Private equity always had tons of zombie firms. The spread of performance on private equity was always huge. The top performers can multiply the money by 3x, 4x, or even more. But, most of them show a loss.
If you're willing to take that level of risk, the overall performance of private equity is actually better than the stock market, but you're playing Russian Roulette with 4 of the chambers loaded.
What does performance mean? Well, it depends on who you are. The PE firm and the owners of the company always win. They never lose money regardless of what happens to the company. The employees in the short term always lose because they will either be let go or operating expenses will be "optimized" in a way that doesn't favor employees. The customers generally lose because the products and prices will be "optimized" where optimization refers to company finances and not product quality or prices. In the rare case where the PE firm actually improves and grows the company, the employees and customers might also win, but those are the employees and customers in the long term.