Friday, January 16, 2009

PEU Boys Look to Reform Global Finance

Private equity underwriters (PEU's) deployed the same greed and leverage as America's recently imploded Wall Street. The Carlyle Group lost Carlyle Capital Corporation, Blue Wave Partners, SemGroup, and Hawaiian Telecom to bankruptcy. Yet, Carlyle leaders sit in positions shaping the future of U.S. and global financial systems.

Dow Jones will hold a Private Equity Analyst Outlook 2009 Conference on January 27-28, at the Grand Hyatt in New York. High finance will be the major topic.

"Technology, globalization, convergence and consolidation are transforming the financial services industry," said Mr. Bernstein, Partner, Financial Services, Grant Thornton LLP. "Successful investing, especially in these tough economic times, requires a thorough understanding of the complex and changing world of financial services."

And who's redesigning this global financial system? Carlyle Group co-founder David Rubenstein sits atop the World Economic Forum panel offering its wisdom. How might private equity come out, given its PEU co-chair? Will Paul Volker's Group of Thirty report offer anything different? That's the topic of a panel at the Dow Jones gathering.

"Bank On It: What PE Firms Must do to Successfully Invest in Financial Services Companies and Financial Assets"

The panel will discuss the recent role of private equity firms as prominent investors in financial services companies, and what is required of them to do so successfully. Panelists will go into detail on how to identify and manage inherent risks in these businesses, and will outline what opportunities may exist in the year ahead. Shasha Dai, Reporter, Dow Jones LBO Wire, will serve as the panel moderator. The panel will include Randal K. Quarles, Managing Director, Global Financial Services, The Carlyle Group.

Mr. Quarles was Hank Paulson's number 2 until Carlyle squirrelled him away. Private equity and hedge funds purchased failed IndyMac Bank from Uncle Sam. The shadow banking system morphs into the real banking system. Rather than return banks to the basics of investing, the greed/leverage PEU boys are offered as the answer. Strange days, indeed.