At least their standard-bearer can always go back to his day job:
The leveraged buyout---a deal structure made popular during the Wall Street boom of the 1980s and again in the wake of the tech bubble---could become much more common soon, according to a report from BofA Merrill Lynch.BofA credit strategists Hans Mikkelson and Yuriy Shchuchinov write that current market conditions have become "unusually conductive for leveraging transactions for this stage in the typical cycle," and that as a result, "credit investors should be concerned about more extreme releveraging in the form of leveraged buyouts" [...]
Markets have QE3 to thank in part for the return of the LBO, according to the report. As the Federal Reserve continues to buy mortgage-backed securities, yields grind lower, and banks no longer see most fixed-income assets as attractive investments.
Thank you, Team Democrat, for fiscal policy that continues to incentivize these risky, debt-financed investments. I mean, if you hadn't taken trillions' worth of mortgage-backed securities off their hands, they might not have so much free money to lend to each other, or even be able to meet the new capital requirements. Oh well, guess they're assuming it's best not to talk to the invisible hand, for when acquisitions like these go bad---and they sometimes do----it's only the poor dumb suckers who get left holding the bag.
---Baron V
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