Paul Solman:
But as with hedge funds, private equity’s main appeal to investors is the industry’s outsized return rate, estimated at 13 percent a year for the past 25 years, by comparison, the stock market, as measured by the S&P 500, 8.6 percent a year.
Now, debt and expertise might result in more efficiency and profits, but so might cutting corners, supplies, staff, and using a tactic at the heart of almost every hospital buyout, selling off the real estate.