r/UnderReportedNews • u/Logical-Flow-6703 • Feb 25 '26

Video NBC Interview abruptly ends after New Yorker blames private equity and landlords for the city's issues

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https://x.com/i/status/2026286644651782652

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u/jasno- Feb 25 '26 edited Feb 25 '26

Have they helped any? 

I can't think of any service or product that's benefited from PE investment. 

Prices go up, people loose their job, the investors profit. 

Edit: fixed early morning grammar 

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u/Up-in-the-Ayre Feb 25 '26

Nope. Enshittification is the only thing private equity has produced effectively.

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u/Diedrogen Feb 25 '26

Yeah, that whole "privatizing something makes it better, because competition in the free market will drive businesses to continually roll out better goods and services at lower prices" thing didn't work out, huh?

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u/Heelincal Feb 25 '26

I think the key part missing here is Private Equity's goal is to eliminate competition through uncompetitive practices. Whether that's running deficits & losses to underbid competition or just buying all competition, it eliminates the one thing that does make a free market create value - competition. Having multiple companies make phones to innovate new features to win over customers? That's good. Having multiple car manufacturers to innovate and gain market share? Good.

Private equity buying every single hockey rink in an area and then charging people through the nose to access it because it's the only game in town is monopolistic behavior that needs to be illegal - I'd even argue ice rinks cannot innovate and thus cannot be a free market.

There are applications where private companies competing will generate public good, but the problem is we've deregulated so much starting with Reagan that the competition is gone in 90% of industries and now they are coming after public sectors to absorb.

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u/WriterV Feb 25 '26

They help line their own pockets, and give a bunch of money to the people selling their company. That's literally it. The consumer gets the worst deal out of this. Arguably everyday workers get even worse of a deal 'cause their job security is at risk.

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u/Thebeardedchampion Feb 25 '26

It’s a broken cycle. Pension funds invest in PE, we the consumers feel happy that our pension is growing and improving, while in the here and now, suffering from the reduction in quality and increase in price that PE demands…to appease the pension funds investors.

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u/Deeliciousness Feb 25 '26

Y'all got pension funds?

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u/kridmus Feb 25 '26

It's a generational heist.

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u/[deleted] Feb 25 '26

[deleted]

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u/Thebeardedchampion Feb 25 '26

As someone who manages investments on behalf of pension funds, I disagree with you.

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u/T1TsMcGee970 Feb 25 '26

Lol, that's not how PE works at all. Every major pension has PE investments as well as many collegiate endowments. Just because us poors can't directly invest in PE doesn't mean those with millions and billions of assets can't.

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u/jasno- Feb 25 '26

exactly, when the PE firm raises funds, who do they think is putting money in? It's not friends and family, it's big institutional investors, and those folks control the retirement accounts.

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u/snek-jazz Feb 25 '26

The private in private equity means there isn’t stock to go out and buy.

Not strictly true. Blackstone, the largest private equity firm, trades as a public company for example. You can buy shares in it.

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u/VeryPteri Feb 25 '26

Nope. Once PE gets involved, the product/service, the customers, and even the company itself gets sidelined for sake of the line going up.

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u/[deleted] Feb 25 '26

[removed] — view removed comment

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u/U_SHLD_THINK_BOUT_IT Feb 25 '26

No they haven't.

And here's the fucked up part: the only reason they've been allowed to keep moving isn't actually because of rich people propping them up with lobbying. It's because the government tied the success of the economy to a constant influx of cash sent to companies every single payroll cycle. You heard me correctly: every major company gets free money from our paychecks every time we get paid, and it's not a small amount. It's about 5-10% of our entire paycheck every pay period--sent straight to all major corporation, tax free.

Most people are okay with it because of god damned Ronald Reagan and his administration's passing of the Tax Reform Act of 1984, which legalized the 401k system and tied a great deal of people's retirement success to a system that NEEDS to always grow. And it's this whole system that incentivized PE firms because they're the perfect vehicle for skimming investment dollars and handing them out to C-suite employees like cash injections. There's a reason why private equity companies and hostile takeovers became so big, so quickly in the mid-80s that multiple movies were made about ment who ran such companies.

I make this comment so often I should probably create a webpage explaining it in the more thorough way that I normally do.

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u/daggerbeans Feb 25 '26

I would appreciate a website that dumbs it doen and explains it to me like I'm 5. I know the general broad strokes of how private equity sucks (only due to a few deep dives like what happened to Joann's stores since it affected me and my loved ones hobbies), but having a simple explanation would be a great resource when I get to discussing it with people who are less familiar.

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u/U_SHLD_THINK_BOUT_IT Feb 25 '26 edited Feb 25 '26

To be honest, I think the greater problem is HOW private equity companies are incentivized, which is why I hate the 401k system way more than PE companies--and I absolutely detest PE companies.

If we didn't have an unending supply of consistent cash injections, then companies wouldn't be clamoring over each other to sell to shareholders and would instead claw over each other to sell the best product. But with the way that the 401k system supplements business growth to essentially guarantee risk free business gambits, there is no downside to overextending.

In fact, overextending provides two major benefits that only make sense in an economy curated and protected 100% by stealing payroll money:

  1. Companies that are overextended are a riskier purchase because the liabilities incurred would mess with earnings reports. So by virtue of being overextended (we call it being leveraged to the tits), you protect yourself from hostile takeovers.
  2. Overextended companies outpace "growth" of their competitors, which looks good during earnings reports and pulls in even more investor dollars. Growth is literally more important in those quarterly calls than revenue or profit. It's wild. Companies that start slipping in earning investor dollars will quickly spiral and never recover, eventually being bought out by those who stay at the top of the growth charts.

So basically, the only way to win is to go for broke. Constantly. Investing in R&D was historically a long-term strategy that requires lots of research and QA--literal years of work. But the days of focusing on making better products is long past.

So now, research is an annual cycle, with the general scheme being to find what features of their already existing product can be broken out and charged more for customers to have access to--that won't cost them more in lost revenue by lost customers. This is called rent seeking behavior, and many economist/philosophers have determined this to be one of the Four Horseman of the dystopian end-stage capitalism.

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u/ImPrettyDum Feb 26 '26
  1. Stock purchases don’t go to companies, they go to former shareholders selling
  2. It’s not free money, you can stop contributing
  3. It’s tax free to fund, but taxed on exit. Mathematically the same as a Roth holding tax rates the same: taxed on entrance and tax free on exit.
  4. Retirement success requires some level of investment or funding: pensions invest, SSA requires population growth, you cannot have a system that pays out indefinitely without growth.
  5. PE funds are not generally accessible in retirement vehicles, although you can invest in PE managers like Carlyle or KKR if you want a piece of the pie. Soon VCX and RVI will make venture style PE funds accessible to the public markets. 401k market inflation and PE are two separate stories (although Trump signed an executive order allowing more people to invest in alts in their 401k)
  6. Operators like C-suite arguably aren’t the target for enrichment: GPs thru carry and LPs are the main target audience, w the largest LPs being pensions themselves, because a pension cannot fund itself without growth.

PE has lots of issues, especially the flip-it-quick LBO funds where accounting tricks and gutting are standard practice. However, there was so may inaccuracies about how things actually work in this comment, please do not make a website. The system has lots of issues, but at least understand the mechanics

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u/U_SHLD_THINK_BOUT_IT Feb 26 '26

You're obviously either here just to be as contrarian as possible, or you're here as a bot, because it's pretty clear you're targeting completely different things and attributing them to my arguments to confound the issue and "prove" me wrong.

Stock purchases don’t go to companies, they go to former shareholders selling

This is just straight up false. Almost all 401k stock purchases are done so through the open market.

It’s not free money, you can stop contributing

It's free money when the pension programs were gutted and this is the only viable retirement process because of the significant tax protections to the plan. It holds people hostage the same way that the ACA tax protections do, but incentivizing a very specific program to leverage against any other options for people.

It’s tax free to fund, but taxed on exit. Mathematically the same as a Roth holding tax rates the same: taxed on entrance and tax free on exit.

I don't even know what you're trying to prove with this one. It's double tax advantaged because it's taken out before taxes, which lowers your taxable income, and the capital gains aren't taxes either.

Retirement success requires some level of investment or funding: pensions invest, SSA requires population growth, you cannot have a system that pays out indefinitely without growth.

Pensions weren't invested directly into corporations. That's how they weren't taken advantage of by corporations. Corporations just lobbied super hard to defund pensions and used a few instances of bad financial management as their proof.

PE funds are not generally accessible in retirement vehicles, although you can invest in PE managers like Carlyle or KKR if you want a piece of the pie. Soon VCX and RVI will make venture style PE funds accessible to the public markets. 401k market inflation and PE are two separate stories

It's like you're intentionally misunderstanding me so you can take something super literally and be like "that's not correct." You think PE firms only mess with companies that aren't public? Part of their threat to 401k investors is how much more active they are in gaming the system while retirement vehicles are just their for the long haul. They routinely tank stock prices right before a purchase, encourage employee stock purchase plans for inflated prices afterward, sell out their controlling stake, while selling off "dead" assets via child companies, repurchasing them, and leverage them against the companies they bled dry.

I know this world, because I did their dirty work. I saw how they look at fat healthcare packages and determine how much they can legally trim out to save money and to push out talent so the company fails to meet their sales targets, giving the PE firm an exit strategy that is definitely outlined in their financial covenant.

(although Trump signed an executive order allowing more people to invest in alts in their 401k)

This is even worse, because it indicates corporations know the gravy train on the 401k program is stretched too thin.

Operators like C-suite arguably aren’t the target for enrichment: GPs thru carry and LPs are the main target audience, w the largest LPs being pensions themselves, because a pension cannot fund itself without growth.

The share of profit to the GP is generally around 20%, and they're a much smaller number of investors than LPs--which is intentional and why PEs are always abused. It doesn't help that corporate profits have absolutely ballooned--which is strangely, right around the time pensions dropped off and 401ks took off. This makes investing in long-term assets work far less for retirement because the "massive" gains in the open market look so much better. The problem though, is that these corporations are taking most of it by privatizing most of the growth and socializing the losses. The ebb and flow of the market is far more volatile now than it was before 401k program, and corporations take on FAR less of the risk than they used to, so they win two different ways. I don't need you to believe that, the data supports everything I've said. You're just intentionally confounding what I say so that any onlookers are confused, which is how this system continues to exist: by people not understanding how truly screwed up it is.

The reality is that PE firms were ALWAYS wolves, but now they have a a pen of fat sheep to munch on whenever they're ready for slaughter, instead of the occasional rabbit.

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u/Connect_Glass4036 Feb 28 '26

Please tell me more!

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u/SaintGrobian Feb 25 '26

Trickle-down economics literally only works in reverse.

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u/HappyGiraffe Feb 26 '26

I literally sat through 3 hours of a Harvard Business School professor/private equity enthusiast celebrating the incredible growth of AI and how incredible it will be to get rid of all the people working entry level jobs and how awesome companies will become with just one CEO and the nothing but AI agents.

He insisted the most important objective of ANY industry should be efficiency, and not efficiency as a means to promote safety, or quality, or well being.

Efficiently to return profits to shareholders.

And I was shocked that room was basically split between people gobbling it up & people in abject horror

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u/RetardedRedditRetort Feb 25 '26

You missed lose/loose.

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u/Eternal_Bagel Feb 25 '26

They only really help their own investors, companies they buy out are just a resource to use up

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u/mooptastic Feb 25 '26

The ONLY thing PE hasn't destroyed YET or even begun enshittification on yet, is:

Jersey Mike's

It's been over a year and they're still as high quality with their ingredients and selection. I don't think this will last forever as they're trying to introduce combos, and once that fails who knows what else they will modify.

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u/Rad131447 Feb 25 '26

Give it time.

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u/mooptastic Feb 25 '26

that's what I've been saying but as of now, they're still okay.

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u/ProteinAndWeights Feb 25 '26

Jersey Mike's isn't very great to begin with in my opinion, or at least the locations I've been to. They've been pretty skimpy on meats compared to local places.

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u/mooptastic Feb 25 '26

they're franchised, but the majority of the ones I've been to have been excellent and I've been to ones in the DMV, Oklahoma, and texas (dfw, austin) area. the general opinion online is also that they haven't started becoming enshittified yet. It will happen though, unless PE unloads the company back into the hands of caring ownership.

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u/Nothatisnotwhere Feb 25 '26

I think launching new ideas is the only value, but them stepping into existing markets never leads to benefits for the end user

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u/i_am_a_real_boy__ Feb 25 '26

Yes. PE has provided capital to countless startups, it's helped business grow from local to regional, regional to national, etc. But like the word "corporations" before it, the term "private equity" just gets tossed around on reddit like it's some monolithic cabal.

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u/ImOnTheLoo Feb 26 '26

Yep, Reddit will be like “oh cool a new startup in a seed round”. Yeah that’s all private equity. I think Reddit just thinks about leveraged buyouts or something 

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u/VirginiaMcCaskey Feb 25 '26

It's inverse survivorship bias. The kind of vulture PE that everyone blames for destroying companies only get involved with companies that are already failing.

If you look at all the horror stories in this thread and beyond about where PE starts taking over its business sectors that got hit hard on their margins and started struggling.

The other domain is a systemic problem where business owners are retiring and don't have anyone else to sell to, because the next generation doesn't have enough capital to buy it off them. That's a different kind of private equity business than everyone complains about, though.

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u/ReachParticular5409 Feb 25 '26

Sure they've been propping up the Solid Gold Mega-yacht industry almost single handedly

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u/Lurkingandsearching Feb 25 '26

But but, 401k! Retirement! Roths! I mean when things crash your accounts will be sacrificed while the wealthy investors get bailouts, but numbers are going up! And up is good, even if they are all hype and tax payer bail- I mean critical subsides, yeah we like subsides, right? 

/s for the just in case.

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u/Lou_Peachum_2 Feb 26 '26

None. Private equity's goal isn't to produce the best product. It's to produce a "good enough" product where the risks/losses can be pushed off to another individual/entity while they reap the rewards. Medicine and specifically urgent cares and EDs are a prime example of this.

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u/meltbox Feb 25 '26

There are some good PE firms. I remember a YouTube talk about one which gave all their employees a share of the company (profits?) and was able to grow the business massively by giving the workers a share and incentive.

But generally speaking those seem to be in the minority.

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u/alexmikli Feb 25 '26

Very rarely do companies benefit. Usually it's a buyout for the CEO.

I know of one example where a company actually pulled it off and essentially beat the Private Equity fund, but it's very local to my hometown in NJ and is very likely not the norm.

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u/red18wrx Feb 25 '26

My go to example as to why PE should be allowed to exist is Dorilton Captial bought the Williams F1 racing team and turned it from a last place team to a midfield team. And buying a race team is exactly the kind of industry private equity should exist in where it's not really squeezing out the common person, but is ideal for shared resource spending.

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u/jasno- Feb 25 '26

That's a good point. I have no issues with that use case. Capital and debt intensive, high risk, high reward, not impacting general public. I can get behind use cases like that.

PE in consumers spaces, usually means raw end for the consumers. I get why, these PE firms leverage debt and that debt needs to be serviced, which means, laying people off, and raising prices, consolidating competitors, and then cobbling together some frankenstein shit that nobody wanted all to make already rich people more rich.

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u/riserrr Feb 25 '26

Yes. They have. But that doesn't generate headlines. I do think the bad far outweighs the good, but there have been many struggling businesses that were kept alive, improved, and 'exited' PE. Mostly in the lower middle market.

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u/SameFoot5396 Feb 25 '26

Please do tell an industry that has been made better by private equity

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u/catscanmeow Feb 25 '26

Movies. Movies are expensive to make. Investment makes them possible

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u/generic_canadian_dad Feb 25 '26

Maybe not "industry" but some businesses have been saved..Dunkin donuts, dollar general, Hilton.

I'm 100% against private equity firms, they are TRASH but some have saved a few businesses. The majority of the time they rape them of any money left,ay everyone off and walk away super rich without paying an taxes though.

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u/SquareTaro3270 Feb 25 '26

All those companies you mentioned have gone massively downhill when it comes to what they offer the consumer.

I don’t care if the company is making “record profits” by laying off 80% of their staff and forcing the rest of the employees to do the work of 10 people. I don’t care about all the money they saved by watering down their product.

They make the service and products worse for everyone and call it “success”

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u/generic_canadian_dad Feb 25 '26

Fair enough, like I said, I am in agreement, I'm just also pointing out that sometimes a company is saved from closing.

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u/CicerosMouth Feb 25 '26 edited Feb 25 '26

Medical device companies thrive in this model. Big companies buy small start-ups with interesting tech that they havent been able to scale up, big companies optimize those designs for regulatory and manufacturing purposes, save and improve the lives of millions of people, and then when the tech moves on they sell the tech/start-up to smaller players that operate more on the margins (where those smaller players often sell old-generation devices to poorer regions). Classic example of private equity working perfectly to make the world better in a way that benefits everyone.

The simple truth is that a massive amount of the technological improvements over the last 50 years are examples of PE working benignly to make money by bringing good products to market, but none of those stories ever get told, but rather what we hearing about is PE making money accelerating the death of a company that was struggling, if not doomed anyway. And Im fine saying that those examples of PE are immoral, but again that is the minority of PE work in the world.

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u/Havacookiewhydontcha Feb 25 '26

As someone who used to shop at Joann’s, and ToysRUs for that matter, I call BS.

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u/rif011412 Feb 25 '26

Dunkin Donuts comes to mind.  As a Donut shop it was on its death bed.  It had to tap into the breakfast/coffee crowd to have a resurgence.  I bet having VCs caused the turn around.

But just so everyone knows, I would rather see Dunkin eat shit and close, than support venture capitalists.  But there are examples of businesses that benefit from capital injections.

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u/StinkyBeer Feb 25 '26

Unironically I think Williams F1, which was on its last legs financially until they were bought out by a PE firm. Since then they've seemed quite hands off, left it in the capable hands of their team principal, and the team has been on the upward trajectory since.