Topic: Private Equity is a scam. (Read 1741 times)
That is not a scam. Its sort of like saying that breakers yards are a scam because they pay less than the car is worth. The owners of the company will only sell to private equity if the company is in distress. Its one step short of putting the company into liquidation.
This should be obvious. The Federal Reserve exists to control capital. They can print money to buy whatever they want. You say this is a "loophole" as though anyone in banking or government would want to change it.
What makes you think the stock market exists in order to allow you to control capital instead of central banks and government?
What makes you think the stock market exists in order to allow you to control capital instead of central banks and government?
I have researched private equity and found it to be a complete taxpayer scam.
What I have found is they get a lot of debt to buy the company and when they do they put it on the books of the company they buy. Usually they manipulate the price of the stock down prior to buying it. Being on the books it is tax deductible before the 35% corporate income tax. Thus, the portfolio company, the management company, will always keep the companies fully loaded with debt. Debt they control. Then as they issue more debt, they also issue large dividends off the company, generally money of the debt.
In summery if you vote for Romney, you are voting for a moral crook. The loophole is easily eliminated by taxing corporate debt after corporate income tax.
If you own a stock that is ever bought out, make sure you sue them. They have no right to go into your account and take your shares.
What I have found is they get a lot of debt to buy the company and when they do they put it on the books of the company they buy. Usually they manipulate the price of the stock down prior to buying it. Being on the books it is tax deductible before the 35% corporate income tax. Thus, the portfolio company, the management company, will always keep the companies fully loaded with debt. Debt they control. Then as they issue more debt, they also issue large dividends off the company, generally money of the debt.
In summery if you vote for Romney, you are voting for a moral crook. The loophole is easily eliminated by taxing corporate debt after corporate income tax.
If you own a stock that is ever bought out, make sure you sue them. They have no right to go into your account and take your shares.
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