If you have not heard yet, Kohlberg Kravis Roberts & Co. is to go public (NYSE:KKR). I am waiting for someone to create an Exchange Traded Fund so that we may trade the traders.
Despite a very well publicized narrative that the private equity funds are using the IPO vehicle to liquidate their positions, there seems to be enough demand to get the IPOs off. My suggestion for the proposed ETF's stock symbol is "TRAP."
The stream of private equity offerings reminds me of a bad Zombie movie. You know, the scene where they just march forward mindlessly and regular village folk cannot reason with the undead? I think the Zombies first kill the village priest so as to disconnect the people from truth and knowledge - a rather telling strategy!
Everyone is pointing the financial finger to the huge fees that the private equity funds have been making. Part of KKR's rationale is to try to avoid paying fees to investment bankers. But as any investor who follows publicly traded investments know, banker's fees are fickle and dry up in an instant.
Private equity has built up a huge inventory of deals where they are restructuring and supposedly creating value. The private equity industry cannot point to a steady stream of repaired businesses that shareholders will want. It's all about the fees, and therefore just a money grab.