[greyw]

Banks are not taking huge losses because a huge fraction of loans to PE work out.

Imagine believing PEs are just constantly scamming banks out of their money. Yeah sure.

Its just that people have this carricature of PE in their head plus we are on HN where there are a huge fraction of Dunning-Krugers when it comes to topics about economy. Thats why you get these internally inconsistent arguments

[gamblor956]

Banks aren't the primary lenders to PE firms, but yes, the general PE business model for debt-financed acquisitions is entirely premised on using the collateral of acquired businesses to take out loans to pay themselves "dividends" and then letting the business fall into bankruptcy. This has been covered in extensive detail by WaPo, WSJ, The Economist, and the NYT. Mark Levine has some good articles on this.

It's okay for you to admit that you don't understand how PE firms work. I've been on both sides; as their tax advisor and at a PE-owned company and I've got firsthand experience with it.

[greyw]

PE do LBOs. Yeah. And?

I only contest the claim that lenders are the dumbasses that keep on taking losses. It's nonsense.

Despite having been a tax advisors apparently you don't understand that. That is suprising. Kinda shows that your role doesn't necessarily translate into knowledge about how companies operate.