Michael Lewis has a good column on the private-equity boom:
Much of the financial drama of the past five years -- the rise of Eliot Spitzer, the Sarbanes-Oxley law, the muckraking in the financial press -- has been staged, ostensibly, to level the playing field on Wall Street. But the players have responded by building a new field, apart from the old one.
The regulation, by raising the cost of doing business to public companies, has had the perverse effect of reducing the value of a company simply because it is public, and thereby creating further incentive to take it private. Sarbanes-Oxley has done many things, but one of them is to create a lot of cheap assets for private-equity firms to buy.... We may not have arrived at the point where the publicly traded shares in a company are a sure sign that those shares are a poor investment. But that's the obvious, ultimate destination.
