PEUs Need Tony Bennett: Is Feeling Mutual?

UVA basketball head coach Tony Bennett resigned his position saying he is "a square peg in a round hole."  His comments on the state of college athletics included:

"I think it's right for student-athletes to receive revenue. Please don't mistake me," he said Friday. "The game and college athletics is not in a healthy spot. It's not. And there needs to be change, and it's not going to go back. I think I was equipped to do the job here the old way. That's who I am. "

It's going to be closer to a professional model. There's got to be collective bargaining. There has to be a restriction on the salary pool. There has to be transfer regulation restrictions. There has to be some limits on the agent involvement to these young guys. ... And I worry a lot about the mental health of the student-athletes as all this stuff comes down."

Who's leading the change charge in college athletics?  Private equity underwriters (PEU).  The greed and leverage boys have invaded professional sports around the globe.  Most recent professional team sales involved a PEU or a storied founder.  PEU or PEU founder:  the management shenanigans are the same.    

Coach Bennett's principled retirement will be followed by something.  I hope it's not employment in one of the least principled businesses in our country.  The buying and selling of companies is bad enough.  The flipping of college kids athletic futures sounds downright sinister.  

Tony Bennett likely has heard much about private equity from wealthy alumni boosters.  One close supporter got in early with The Carlyle Group and unfortunately died from a Covid-19 infection in 2021.  In an article titled "A Faithful Fan" Bennett remembered his friend:

“Greg was one of the first people I had dinner with when I got the job 13 years ago,” remembered Bennett. “At the time, I remembered thinking, ‘Wow, this guy is passionate and knowledgeable about UVA Athletics.’ He knew more about my coaching career than I did! Over the years, he became a faithful supporter and friend to our program through the great years and the challenging years. That spoke volumes to me.” Bennett continued: “My wife Laurel and I loved him. He donated a well for the needy in Africa in Laurel's and my names, and to this day, it's one of the most remarkable things someone has done for us. We are all sad that Greg is no longer with us, but we are beyond grateful to have known him and will forever appreciate who he was and what he did for all of us.”

A dear friend's employer is not a predictor of Coach Bennett's next step career wise.  Nearly everything Tony Bennett has done has been principled, focused on doing the right things in the right way because that's who you are (intrinsic motivation).  

PEUs are all about incentives, do this to get that, money, power, political influence.  I can't think of a worse next job for Tony Bennett than employment with the greed and leverage boys.  However, that is the tidal wave getting ready to engulf college athletics.  They need someone like Tony.  The question is does Tony need them?

Voters Can Use Head to Examine Trump Financial Disclosure

Red Team Presidential nominee former President Donald Trump has business operations throughout the globe.  Some are under his name while others are under DTTM Operations LLC or another Trump corporate entity.  

Consider this when he proposes throwing 20% tariffs on everything.

Trumps filings are not searchable but a review showed his monthly pension of nearly $6,500 from the Screen Actors Guild.  

Flashback to early 2021:

Donald Trump has resigned from the Screen Actors Guild after the union threatened to expel him for his role in the Capitol riot in January.

“I no longer wish to be associated with your union,” wrote Trump in a letter shared by the actors guild. “As such, this letter is to inform you of my immediate resignation from SAG-AFTRA. You have done nothing for me.”

I wouldn't call a pension "nothing."  In 2022 Trump valued the pension benefit "as much as $1 million."  Two months ago he declared the value "not readily ascertainable."  

Trump declared a $300,000 royalty related to the Greenwood Bible.  That's a handsome sum.  And yes, the "God Bless the USA Bible" is manufactured in China.  

I suggest voters use their head to examine Trump's six part financial disclosure filing.  It may strike some as odd that a financial genius is not able to determine the value of so many of his holdings.

Is that the new way to toss aside conflict of interest concerns, pretend there is no real value?  

Is Trump Signaling PEU Love with Financial Disclosures?

 

A review of part three of former President Donald Trump's latest financial disclosure produced a number of private equity underwriters (PEU).  None were over $15,000 and several were less than $1,000.  That raises the question.

Is Trump virtue signaling the greed and leverage boys with his disclosure filings?

Today I heard a corporate executive describes Trump's 21% tax rate for corporations as their "fair share."  I did not realize taxes were like United Way donations.  

Long ago Trump's VP sidekick JD Vance showed he is a man of the PEUple.  Politicians Red and Blue love PEU and increasingly, more are one. 

Did PEU Directors Help Break Boeing Quality?

Much has been written about Boeing's series of stumbles.  The latest "fall" involves the company's credit rating.  My wise friend wrote:

Just to reiterate and solidify what a joke we are when it comes to credit. S&P placed Boeing on credit watch negative because of strike related financial risk?

Meanwhile, the financial engineering over the past two decades, the lack of real leadership, the reduction of quality control in their supply lines due to efficiency ratios for financial performance, among many other factors, never enter the credit rating. How is that for burying the real bodies of a crisis situation? Boeing is just a prime example of the blame shifting and lack of accountability throughout the financial sector.

Twelve years ago the majority of Boeing board members had direct private equity underwriter (PEU) affiliations (6 out of 11) while a seventh lobbied for the PEU association.   Board members are recruited for their specific skills and background.  Over half of the 2012 Boeing board knew PEU financial machinations which includes significant cost cutting.  

The public has seen Emergency Room care plummet quality wise under PEU ownership.  Vox reported:

When private equity comes for health care, though, the result is human suffering: Elderly and intellectually disabled people sitting in puddles of their own waste, sick patients not getting the care they need, worse outcomes for patients. 

Oddly enough, I recently flew next to a Medical Ambulance pilot.  His employer is private equity owned.  He'd recently reached out to friends, professionals in a variety of industries, and they all said the same thing.  "You can't believe what they (executives) are doing here!"   Across the board senior leaders were blowing through basic and longstanding practices.  

I'm sure some worked for PEU affiliates while others, like Boeing, had PEUs on their board.  The game will continue as long as capital can be had.

PEU Sports Interviews

CNBC interviewed the CEO of Sportscorp regarding private equity money flooding sports.

Yahoo Finance interviewed Carlyle co-founder David Rubenstein.  Asked about the impact of private equity investment in sports.  His answer:  "Well, drive up prices."  Just as they've done in housing, healthcare, pharmaceuticals and nearly everything they touch.

Rubenstein is the lead owner for the Baltimore Orioles and Carlyle holds a stake in the Seattle Reign.  A longtime Baltimore sports writer sent a letter to Mr. Rubenstein.  The author hopes for a better hand from lead owner Rubenstein relative to the prior team owner:

Over my three decades in dealing with the emissaries of Peter G. Angelos, this was not considered a bug but far more of a feature ­– pettiness, anger and retribution.

Private equity underwriters (PEU) typically take a steamroller to people expressing legitimate concerns.  Winning the game of financial profit maximization, obtaining public subsidies (direct and indirect) and cultivating political influence (which produced "policy making billionaires") usually requires a signature focus that excludes listening to real people.  

The Baltimore sports writer can appeal to other new Orioles owners, three of whom made their fortune with Ares Management.  However, the threesome may be busy as Ares is close to striking a deal to buy a portion of the Miami Dolphins.

 

The Sportscorp CEO noted the other announced deal for Tom Gores to buy a stake in the Los Angeles Charges is not a PEU deal.  It is however with a PEU founder.

Platinum Equity - A Global Private Equity Firm Founded by Tom Gores (on Forbes billionaire list)

So what can people expect?  Platinum Equity bought the NBA's Detroit Pistons in 2011.  The Pistons:

have been the league’s worst franchise for 15 years or so.

Gores bought out Platinum Equity's stake in the Pistons in 2015.   The City of Detroit provided $34.5 million in subsidy for the Pistons to move into a new facility.  Check out the name on the Pistons' home court.

Platinum Equity, another PEU arms length agreement.

Carlyle's Rubenstein located his firm in Washington, D.C. in 1987 to access Uncle Sam's wallet and intermittently non-lobby to keep his PEU preferred "carried interest" taxation.  He's predicting more tax cuts regardless of who wins the White House in November.

The PEU boys love a public subsidy but hate paying taxes.  So why is all this going on?  Because politicians Red and Blue love PEU and increasingly, more are one.  Professional sports is the newest PEU love and as Mr. Rubenstein said prices are going up.

Carlyle, Unison Target Strapped Homeowners

The Carlyle Group and new affiliate Unison want to be on both the debt and equity side of your home.  FT reported:

The company will buy as much as a 15 per cent interest in homes, spending between $30,000 and $500,000 per home. The homeowner will pay for an appraisal and Unison will invest at a 5 per cent discount to that appraised value. There is also a 3.9 per cent transaction fee.

At the end of the 10-year loan, Unison would, however, get its 1.5x appreciation share as well as the capitalized sum total of the 1.8 per cent initial cash interest rate savings (that’s the 7 per cent minus 5.2 per cent).

Carlyle plans to buy $300 million in Unison Equity Sharing Home Loans.  It would then market those to insurance companies (clients of Carlyle's Credit Strategic Solutions group).  

Unison said its typical customer has a Fico score over 700 and that typical use of proceeds are home improvements or paying down credit card debt.

Credit card debt raises red flags and calls into question someone being able to pay off a large loan, plus an outsized amount of the home's appreciation, plus making up for the interest rate break given on the loan.  

I expect a large number of Unison clients not being able to keep their home after the 10 year loan comes due.  

What happens when unsatisfied borrowers go to regulators and complain about Carlyle's Unison?  They might get, "Which Unison?"  Home equity Unison follows government procurement contractor Unison in the Carlyle family tree. 

Carlyle held government procurement contractor Unison from 2005 to 2010, then repurchased the firm in June 2020.  After a two year hold Carlyle flipped its majority stake to Madison Dearborn Partners but retained a minority investment (which it still holds).

Carlyle just wants their share of well, everything.  It's the PEU way.  Don't give it to them.

Home equity Unison's CEO Thomas Sponholtz said "We are trying to democratize the rich relative."  Carlyle's billionaire co-founders qualify as rich relatives.  

Sponholtz' worked for Bear Stearns, where he and the company were sued for negligence and negligent misrepresentation.  The parties settled for $130,000."   That was a long time ago in a world that no longer exists.  

Unfortunately, our current world has far more conflicted entanglements.  Sponholtz and Carlyle want you to bite on their sales pitch.  Read all the fine print before you sign, every blanking word.

Banks, PEUs Join Hands for Private Credit Offerings

Big banks and storied private equity underwriters (PEU) are joining to offer credit to private companies. The Federal Reserve Bank put out a "Fed Notes" on private credit in February 2024.  It states:

Private credit or private debt investments are debt-like, non-publicly traded instruments provided by non-bank entities, such as private credit funds or business development companies (BDCs), to fund private businesses.2 Private credit is typically extended to middle-market firms with annual revenues between $10 million and $1 billion, but has grown rapidly in recent years to fund larger companies that were traditionally funded by leveraged loans.

The Fed piece closes with a section on Interconnections with Banks:

While bank lending to private credit funds appears moderate, there are growing interconnections between these two types of lenders. First, banks are increasingly partnering with private credit funds to fund new deals. Second, banks are progressively selling complex debt instruments to private fund managers in so-called "synthetic risk transfers" in order to reduce regulatory capital charges on the loans they make. Such instruments have limited transparency and pose hidden risks to the financial system, especially as the industry has yet to endure a prolonged recession. Relatedly, there is growing concern that tighter regulations such as Basel III endgame could intensify migration of credit from banks to private credit lenders. Considering borrower risk profiles, such substitution is less likely to occur to bank-held loans, and more so with syndicated leveraged loans. In such cases, banks stand to lose underwriting fees to private credit funds. These developments suggest that private credit will become increasingly important to credit market functioning.

Yes, lets count more on instruments with limited transparency that pose hidden risks to the financial system.  More, please!

Thank heaven the PEU boys have found more ways to make fees.  Recognize any of these names?

 

  

It's a who's who of people who speak directly to elected officials without designating themselves as lobbyists.  It's also the list of people who hate paying taxes.

My wise friend wrote regarding the Fed and private credit:

It's kind of sad when a regulator puts out a note of the risks of private credit and stands by as the PEU conductors drive their train off the tracks. The fact that they recognize banks provide a higher form of regulatory framework to establish loans is the first red flag. As you read through the report there are so many factors they minimize.

Once a PEU boy, always a PEU boy.  Right Jay?   Residual PEU holdings, nobody declares those....

Who Serves Who in our PEU World?

Two hearings shed light into the proverbial darkness of outsized political influence.  The first involved the U.S. Senate where Caritas Christi/Steward Healthcare CEO Ralph de la Torre, MD was a no show for his subpoenaed testimony.  

Flashback to 2016 when private equity owner Cerberus had a giant profitgasm.  NYPost reported:

Cerberus received $719 million of the dividend while the remaining $71 million was paid to the Steward management team headed by CEO Dr. Ralph de la Torre.

Private equity underwriters (PEU) spawned the term "policy making billionaire" back in 2011.  

...the new philanthropists share a disdain for established politics and an impatience with the slow churn of old-fashioned policy making.

And how have PEU political donations changed since 2011?   They're way up:

I am not surprised that a PEU might skip an uncomfortable hearing with the people who repeatedly saved their highly unpopular, preferred "carried interest" taxation for the last decade and a half.  

Heck, at least two members of the committee, Red Team Senators Mitt Romney and Tommy Tuberville are former PEUs.

What else changed in healthcare since 2011?  Accountable Care Organizations came into being.  PEU Cerberus cited forming an integrated accountable care organization in its rationale for buying Caritas Christi and forming Steward.

Another change is the mass migration of U.S. healthcare companies to private equity ownership.

Let that sink in...50% of the healthcare industry is owned by private equity.  That means lots of deals.  Oddly, one man behind the Affordable Care Act, Peter Orszag, is now head of Lazard.  Their website states:

Lazard is one of the world's leading advisors on mergers, acquisitions, divestitures and related strategic matters.

Orszag changed his tune on healthcare antitrust after joining Lazard.  Consider his shift:

So Peter wanted healthcare to be overrun by private equity underwriters?  That's quite the admission.  Fortunately, a judge came to the PEU rescue and stemmed any antitrust overreach.  Peter can get back to wheeler-dealing PEU style.  His brother Jonathon can advise groups involved in both sides of an antitrust fight.

Let's tackle the second hearing.

Billionaires can "buy a Congressman" and make their problems go away.  

Who serves who in our PEU world?  Politicians Red and Blue love PEU and increasingly, more are one.  Nearly every former Medicare Chief is a PEU.  

It's no wonder people feel the healthcare system is not serving them.  An accountability mechanism does not exist.  Right Dr. Ralph de la Torre?  

Right Tom Scully?  Scully is the former Medicare Chief who refused to testify before Congress and went on to General Partner with PEU Welsh Carson Anderson and Stowe.  WCAS just benefited from that recent antitrust ruling.

Update 10-2-24:  Lazard's Peter Orszag was on CNBC this morning bemoaning the FTC's antitrust focus on vertical intergration (PEU buyouts).

The Great PEU Acquiescence

MSN reported:

Something has changed this election season. The perennial hot button issue of carried interest, which offers sweetheart tax rates to wealthy private equity and hedge fund executives—and costs the U.S. Treasury billions of dollars—is getting a pass.

The Great Acquiescence has arrived. 

...an Oxford study in June revealed that the largest private equity firms have avoided paying income taxes on more than $1 trillion of incentive fees since 2000—a line that seems tailor made for a campaign commercial—barely got any notice. 

Now, any momentum to change the carried interest rate seems to have fizzled altogether. Just last week, former president Trump verbally sparred with Kamala Harris, the Democratic nominee for president and current VP, in a much watched 90-minute debate. Neither side mentioned carried interest or even taxes. 

Politicians Red and Blue love private equity underwriters (PEU) and increasingly, more are one.   How did this come to pass?

PEU legend Carlyle Group co-founder David Rubenstein covered the history in a recent Bloomberg Audio interview and had a number of startling admissions.  First, this non-lobbyist regularly meets with elected officials.

 ...let’s get members of Congress to come and sit with each other from different parties in different houses, which they rarely get a chance to do. No press. Nobody can see ’em talking to somebody who’s a different member of a different party. And that’s been going over 10 years. 

Rubenstein chronicled Carlyle's early history after locating in Washington, DC.

Later I went out and recruited big names who had been in government, people like former Secretary of State, Jim Bakker, former Secretary of Defense, Frank Carlucci. And that gave us a certain allure because people were wondering what are they doing in an investment firm?

What were they doing?  Steering huge chunks of the federal budget to Carlyle Group affiliates through their non-lobbying political connections, reading the government tea leaves to direct Carlyle leveraged buyouts, and recruiting more government insiders to the secretive private equity underwriter.  That almost sounds villainous.

Blue Team Senator Kyrsten Sinema's massive payday awaits.  She heroically saved PEU preferred "carried interest" taxation.  Legislators will watch closely her next career move.  It could be theirs.

The AI History Post that Won't Go Viral

2015:  Flashback to a time global elites saw the power of artificial intelligence: 

In 2015, Henry Kissinger was at the Bilderberg conference in Austria, listening to the head of Google DeepMind, Demis Hassabis, give a presentation on artificial intelligence....

2016:  Two stories previewed Bilderberg attendees:

Alex Karp, CEO of the data analysis firm Palantir Technologies, will be there this year as usual.

AI expert Demis Hassabis, the director of Google’s DeepMind project, as well as the co-chairman of OpenAI, Sam Altman. 

With Reid Hoffman, the founder of LinkedIn, back at the buffet this year, it seems that Bilderberg’s love affair with Silicon Valley is flourishing. And with cybersecurity high on the conference agenda, we have to spare a mention for Alex Karp, the CEO of the surveillance and data-mining giant Palantir.

The Tech Gods put their money where their Bilderberg lay.

The list above is a mix of TechGods and billionaire PEUs (KKR, Carlyle).  Both groups rely on political connections to pilfer Uncle Sam's wallet and ensure safe harbors for their schemes.

2019:  Three years later:

In addition to Schmidt and Thiel, California billionaires Alex Karp and Reid Hoffman also attended the Bilderberg meeting in Switzerland. Karp is the CEO of the data analytics firm Palantir, which he co-founded with Thiel. Hoffman is a co-founder and former CEO of LinkedIn. 

The four tech billionaires have ties to the U.S. Defense Department and/or intelligence community. Schmidt chairs the Pentagon’s Defense Innovation Board, of which Hoffman is also a member. Palantir’s clients include multiple branches of the U.S. military and multiple intelligence agencies.

Even back then these guys were not camera shy.  Which brings us to today. 

Eric Schmidt recently spoke at Stanford University.  His comments were eye opening.

As shocking as Schmidt's statements were on intellectual property theft and insider political influence, the video had a dark comedy ring to it.  

Which brings us to Alex Karp's recent guest appearance on Real Time with Bill Maher.  I wrote my wise friend, sharing an expletive about the man who protected evil Bilderbergers getting softball questions from Bill Maher.  

Maher closed with "Nice to meet you." A song popped into my mind with the chorus "Pleased to meet you, can you guess my name?"

Politicians Red and Blue love both the TechGods and PEU.  It turns out comedians do too.

What are the odds of a post on Eric Schmidt. Peter Thiel and Alex Karp going viral?  Miniscule.  One wave of a TechGod's hand and pooof....

Update 9-18-24:  Yesterday CNBC's Jim Cramer asked how many rights will be eliminated by AI.  He said something like we'll be down to six out of ten.  Taking, it's the nature of their game (TechGods and PEU Legends).

Jesse's Cafe Americana ran the following quote:

"We can never be gods, after all.  But we can become something less than human with frightening ease."

N. K. Jemisin, The Hundred Thousand Kingdoms

The head of Google Cloud told Goldman Sachs attendees last week:

...for 11 years now, Google has built world-leading AI systems. We are in our sixth generation of accelerated technology,

Youth, College and Pro PEU Sports

This summer I saw numerous stories about the greed and leverage boys targeting sports, professional, college and youth sports.  Youth sports?  Is nothing safe from the clutches of private equity underwriters (PEU)?  Apparently not.

Two PEUs are behind youth oriented Unrivaled Sports, Josh Harris of Apollo Global and David Blitzer of Blackstone.  They used their personal wealth accumulated from their respective firms to fund the venture.

College sports is high on the list for new PEU investment.  A legal settlement on top of Name, Image and Likeness (NIL) deals for players will have many college teams looking for a PEU partner.  

The greed and leverage boys love secure revenue streams and price inelastic environments.  Remember these guys graduated from at least one institution of higher learning.  Many have buildings in their name from funding big capital projects.  

It will be interesting to see how they split up the sports industry without encouraging real competition for prime assets.  It used to be club deals, then it was speaking code and sending messages through the media.  

Who might approach your alma mater for a cut of their ticket/box seat revenue or a slice of a student's NIL money?

Also, the NFL just approved allowing PEUs to own up to 10% of any team.  Other leagues invited the barbarians in years ago.

What happens when billionaire owners add billionaire PEU founders to their ownership groups?  How fast will politicians funnel public money to team infrastructure?  

Remember in PEU land, everything is a secret, from fees to the calculation of returns to whether they have an undisclosed stake in the failure of an affiliate.  It's all proprietary information, protected by non-disclosure agreements.

I hate to see these shuckers wreck yet another industry.  They can't help it.  It's the way they compete.  Tilt the playing field, then fee, fee, fee.

Greed is not a role model.  Ask the parents who had their workplace decimated by PEU ownership.  Unfortunately, so many have grown up in a world dominated by PEUs (the last two decades).  That may explain this: 

Just because politicians Red and Blue love PEU does not mean I have to.  I vote no and no and no again.  

Monetizing Public Service: The AI Way

Vanderbilt University announced the launch of the Institute of National Security in May 2024. Their press release stated:

The founding director and leader of the institute will be retired General Paul M. Nakasone, who has served as commander of U.S. Cyber Command, director of the National Security Agency, and chief of the Central Security Service.

The institute will address:

...the pressing need to address emerging threats from a wide perspective—encompassing not only battlefield innovations but also disruptions to society, such as election meddling, pandemics and ransomware attacks—during unprecedented times.

The institute, expected to launch in fall 2024, will draw on Vanderbilt’s expertise in fields such as engineering, artificial intelligence, cybersecurity, neuroscience, the humanities, biological sciences, emergency medicine, nursing, law and policy.

May to September... I'd say the General's plate is full.  It got fuller in June with an appointment to the OpenAI board of directors.  It overflowed in August with his joining Ballistic Ventures as a strategic advisor.  

General Nakasone is the latest to garner multiple, high paying full time positions.  At least two of the groups are buying influence.

Polticians Red and Blue love PEU and increasingly, more are one.  Public service is now private enrichment.

Update 9-11-24:  Techbro God Eric Schmidt, one of many (Peter Thiel. Elon Musk), revealed the extent that AI plans to appropriate intellectual property (a la China) and the huge sums required for a bunch of connected machines to think (within boundaries).  That money is needed to buy the equipment, stash them in data centers, train them and provide the gobs of electricity needed.  

He revealed techbro gods were behind the CHIPS Act because even though they hate paying taxes, they love Uncle Sam's wallet.    

Schmidt has been a regular at annual meetings of global tamperers, (Davos, Bilderberg, Milken).  These people are shameless.  I can't wait to find out how taxpayers are subsidizing AI's Garbage in-Garbage out.  "We can't prevent the hallucination (within AI).  We can only minimize it." 

This citizen suggests we not waste the money or our energy resources so Techbro Gods can remake the earth in their distorted, disturbing image.

Sheehy Gets Double Blackstone Sponorship

Politicians Red and Blue love PEU (private equity underwriters) and increasingly more are one.  The latest greed and leverage boy to run for office is Tim Sheehy.    Fresh off a massive base wealth injection Sheehy is ready to join the U.S. Senate for the Red team.

Tim Sheehy founded Bridger Aerospace in 2014.  It merged with Jack Creek Investment Corporation, a blank check Cayman Islands exempted company.  

Stephen Schwarzman's Blackstone Group took a 20% stake in the merged company and received two board seats.

PEU legend Schwarzman went from sponsoring Bridger Aerospace to sponsoring its CEO for the U.S. Senate.  Sheehy's main clients are federal and state government agencies.  Schwarzman's $400,000 political donation is nearly Sheehy's 2021 CEO salary ($450,000).  Once Blackstone got involved Sheehy's pay exploded.

Fellow Blackstone co-founder Pete Peterson shifted from PEU religion to reducing government and balancing the federal budget.  Peterson's fellow PEUs hate paying taxes.  Both political parties promised to eliminate the widely hated preferred "carried interest" taxation, yet they failed to get together to do so under the last three US Presidents.  That's alot of Congresses.

Schwarzman and fellow Carlyle Group co-founder David Rubenstein emerge from their glass towers and light around Capital Hill when a serious challenge is made at taking away their tax dodge.  Keeping carried interest is not enough.  The PEU boys always want more.   

My wise friend (who wanted me to note that he is not an expert) stated:

I was wondering if the taxes on non-realized gains was a wake up call for the guys borrowing against their portfolios hyper-inflated valuations in the debt markets to avoid taxes. We have seen this go on in the real estate market, the private equity market, the VC market, and who knows what else in the wealth management business. Our tax policy allows tax avoidance through this and these means. This also creates the wealth inequality and inflation in the system. None of these would be possible without a complicit federal reserve system. No one talks about this stuff though. If we are going to promote asset valuations as the economy then they should basically be willing to take a tax hit for the whole economy to sustain the fiscal budget to run the country. Otherwise they are using a subsidy guaranteed by all of us for their narrow interests. 

My friend can see the 3D chess game PEU billionaires are playing.  The board is invisible to most of us.  

The wake up call might have prompted Blackstone to reach into its CEO pool for a Senate candidate.  The PEU boys need more of their kind on the inside to craft billionaire advantaged tax policy.   

Peter Thiel sponsored J.D. Vance twice and is going for the trifecta.  Stephen Schwarzman is going for the double with Tim Sheehy.  I hope they both strike out.

Update 9-8-24:  My wise friend recently said this about Blackstone:

Don't you get a renewed sense of hope when the Blackstone Global Real Estate Co-head can get on CNBC and tell you how she is investing in the real estate data center market after walking away from hundreds of billions of dollars and obligations in the commercial real estate market.? The education all of us get from those that return the keys and kept the fees it's just so inspiring. The ability to bounce back after locking up investors in a falling market with false marks and yet still have the fortitude and their capital to reinvest in other ideas.

The PEU boys (and girls) are truly shameless.

Update 10-9-24:  Sheehy referred to women under 25 who want the right to control their own reproductive systems as "indoctrinated."  Projection?  Patriarchy?  Both?

NFL Goes PEU

NFL owners approved private equity underwriters (PEU) can now hold up to 10% of any team.  The same PEUs that jacked up your workplace, rent you an overpriced single family dwelling, contribute to grossly overpriced healthcare services and are the behind the scenes owner of your exploding insurance costs can now profit alongside your favorite football team's owner.

PEU money will be used to renovate luxury suites in publicly supported stadiums, so those same PEUs can occupy those suites or rent them out for an absurd amount.  Note:  No one is talking about this money going back to the taxing entities that subsidized the team's stadium. practice facilities or development around those very sites.

Should these PEUs flip their stakes at some future date the taxes they pay on those profits will be at preferred "carried interest" rates.  Despite two decades of public outcry the political Red and Blue teams have yet to get together to eliminate this widely hated PEU tax break.

Look for NFL approved PEU logos at a stadium near you.  I just hope the PEU on your favorite team's hat isn't the one that fired half your department after they purchased your employer.  That would cause some serious cognitive dissonance, which would be bad if that same PEU was trying to get you to buy their LP stakes for your retirement fund.  

It's a crazy, mixed up PEU world where the greed and leverage boys continue to win.  The barbarians took over European football (soccer) some time ago.  The PEU gates are now open at American football.  Sad, actually.  

Fans, watch out for any PEU owners slinging backwash.  I hope luxury suite redesigns take into account ways to protect paying fans sitting just below.

Update 9-8-24:  A news story reported:

"the NFL also informed teams it will take a cut of private equity profits on sales of ownership stakes."

The PEU boys made the NFL into an LP (for free) or the league is now a taxing entity.  

Peter Thiel May Take His Juice & Toys

The Independent (UK) reported: 

Peter Thiel, the tech billionaire who served as the sugar daddy for GOP vice presidential hopeful JD Vance’s Senate run, who helped kill Gawker, and who names his companies after bits of JRR Tolkein lore, said he's considered leaving the US.

Thiel was born in Germany but his parents moved to the U.S. when he was a one year old.  Thiel currently lives in the Los Angeles area.  Malibu currently has a different billionaire battle over the theft of public beach sand.  

Should Thiel leave the U.S. where might he land?  Thiel's corporate dossier provides him many options.  First, Thiel's Juiced Games appears to be based in The Cayman Islands.

Peter needs to live somewhere where life is secure and gays are not imprisoned or executed.  Thiel's Palantir has divisions all over the world, even in his favored New Zealand. 

It's a shame locals in New Zealand don't prostrate themselves before billionaires like Americans.  Since they don't Thiel's preferred moving destination remains a question of speculation.

Thiel can't move to Russia alongside Alex Jones without his holdings losing access to Uncle Sam's wallet.  In addition Peter would probably have his assets confiscated, like many Russian oligarchs.

Where will Peter Thiel land if he exits the U.S.?  Somewhere he can control things.

This techbro God wants to rule.  Whose kingdom is interested?

Update 9-11-24:  The Globe and Mail reported Theil to sell up to $1 billion in Palantir stock:

According to regulatory filings made in August of this year, Thiel plans to sell as many as 28.5 million shares of Palantir by Dec. 31, 2025, or earlier.

The stock sales will be made through an investment vehicle owned by Thiel called Rivendell 7 LLC.

Over one-half of Palantir's revenue came from the governmental segment in 2023.  Remember the billionaire boys hate paying taxes.

Tax Hating, Bond Villain Libertarian Taps Uncle Sam's Wallet

One story on billionaires building underground bunkers led to another on the harms they wish to avoid.  And how do these obscenely wealthy men know about these existential dangers?  They grew up with them in mythological form and then helped them become a current reality.  I can't help but see aspects of a James Bond villain in their dark ascendance.

Take Peter Thiel, founder of PayPal and Palantir, was an early investor in Facebook (now Meta).  Thiel has three private equity underwriters (PEU), Founders Fund, Thiel Capital and Mithril Capital.  

One might expect Thiel to understand product life cycles, given he is part of the techbro live forever crowd.  Nvidia is making big money off AI but Palantir is in the top ten.  The federal government uses Palantir's AI in healthcare, national security and the Department of Defense.

54% of Palantir's revenue is from government contracts.

Thiel's Founders Fund co-led Anduril's latest $1.5 billion funding round.  Anduril has government contracts to produce autonomous weapons systems.  It's now delivered.   

Palantir is not limited to national security and defense.  It's targeting healthcare.

I find it amazing how dependent tax hating libertarians are on Uncle Sam's wallet.  

A battle is underway to remove what few checks exist to restrain corporate power, especially invasive technology where pricing is a trade secret and even coordinate across an industry.  Big's Matt Stoller suggests if the pendulum swings all the way back to corporations:

the consolidation wave, algorithmic price fixing and surveillance is going to ramp up at startling speed.

Note: The pendulum has only marginally swung in the direction of consumers with government serving as a slight check.

There is a modicum of hope.  Local New Zealand citizens turned back Peter Thiel's giant bunker complex.  Their general population should be an example for us all.

Update 8-17-24:  The Daily Show's Jon Stewart noted creepy techbros in his interview with Mark Cuban.  Stewart said "if this new sort of techbro phenomenon is so dystopian in its formulation." Cuban responded "watching what's happening in Silicon Valley is insane.  It's not so much a support thing, it's more like a takeover thing, trying to put themselves into position to have as much control as possible.  They want Trump to be the CEO of the United States of America and they want to be the board of directors that makes him listen to them.  It's not a good thing."

Update 8-18-24:  Peter Thiel went on Joe Rogan's podcast and pondered leaving the U.S. altogether.  Is there a land suited for techbro diety?  

It could be the Cayman Islands:

Dave Troy posted thoughts on techbros Thiel and Musk on X

Tax hating techbros learned from the PEU class before them.  Politicians Red and Blue love PEU and increasingly more are one.

Say Can PEU See: Ellie Rubenstein

Ellie Rubenstein, the daughter of legendary private equity underwriter (PEU) David Rubenstein, resigned from the Alaska Permanent Fund board amid conflict of interest allegations.  Ellie referenced the time consuming nature of APF board service in order to remake the organization in PEU image.  Chris Ullman, former Communications Director at The Carlyle Group, served as Ellie's spokesman. 

Ullman said, “Ellie has concluded that the scope and pace of change necessary to fully institutionalize the Permanent Fund are not compatible with the demands of leading her private equity firm.”

Fully institutionalize?  Nice dig on the way out.  Of course Ellie had the gratitude of new board officers and Alaska's Governor for her fine work.  Never mind that Vice Chair Ellie Rubenstein was slated to assume the Board President role.  From rising President to resignation.  That's a big shift. 

Ullman also hangs a Declaration Partners shingle, according to a recent press release.  The insider money funnel has been good to Chris.  Ullman has his own communications firm and is a senior advisor to Narrative Strategies.  

Chris whistled the National Anthem at a Baltimore Orioles home game in early June.  Ellie's father recently purchased the Orioles.  Lead owner David Rubenstein co-founded The Carlyle Group before establishing his Declaration Partners family office.  

Declaration now competes with Carlyle by soliciting investor funds and doing deals.  Ellie resigned from the APF board so she could spend more time on her PEU, Manna Tree.  Her father is an investor in Manna Tree.  It sounds like a conflict of interest maelstrom. 

There are no conflicts of interest in PEU land, just personal connections that provide insiders multiple paydays for doing part time work.  

There's one less barbarian in the boardroom of the Alaska Permanent Fund as of August 1st.  It's a win but not one worth whistling over.