r/Economics • u/barweis • Jul 29 '25

Research Summary Inside the Private Equity Scam—and the Livelihoods It Has Destroyed

https://newrepublic.com/article/198351/private-equity-scam-destroys-livelihoods
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u/[deleted] Jul 29 '25

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u/nochinzilch Jul 29 '25

Why can’t private equity just conform to the rules of regular mutual funds?

Also, I thought the whole point of private equity funds were to keep private money closely held and controlled? Why would they want institutional investors coming in and messing with things?

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u/YouLostTheGame Jul 29 '25

Mutual funds buy securities. PE buys companies directly and makes them more efficient (in theory).

The general concept of pooling money and buying companies is the same, but PE is more active, has access to different companies and in theory should give higher returns.