Private Equity in America: End of an Era!

Private Equity

Could private equity firms join reinsurance companies and mutual funds in going abroad due to increased taxes and regulations? Without a question, this could happen if Congress and the Obama Administration move forward to change the tax treatment for private equity and hedge fund income from the present 15% for capital gains to that of 35%, the top rate for income. This “carried interest” rule has come before Congress and never moved, … [Read more...]

Compensating Executives by Insider Trading? And it is Legal.

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With much spot light focused on insider trading and excessive executive compensation received at times of recession, investment programs under Rule 10b5-1 receive little attention. Investment plans under Rule 10b5-1 were established to prevent insider trading and protect the securities markets but instead have been used to enhance executive compensation.   Like options, which in theory were supposed to tie management pay to stock performance, … [Read more...]

Money Goes Where It’s Treated Best

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As the old saying goes “money goes where it's treated best.” And it is certainly true when it comes to regulating an industry. In regulating an industry, the government must treat money well in order to maintain the health of the companies under its jurisdiction. The regulation of the financial sector imposed by The Obama Administration will have tremendous negative consequences if the old proverb is not quickly learned. The negative effect … [Read more...]

The “Other” Cliff Comes With Heavy Price Tag For Economy

The Other Cliff

As the Fiscal Cliff has garnered a great deal of attention, another cliff is waiting on the horizon in the shape of vast regulations that President Obama will try to push through in his second term.    This wave of far reaching regulations could pose a bigger threat to the US economy that appears to finally be turning the corner from the financial crisis of 2008. In fact, some observers contend that cost of newly proposed regulations could … [Read more...]

Twinkie – An American Cake: Sweet For Some, Bitter For Others

Twinkie

A group of hedge funds swooped in to “rescue” a struggling corporation—Hostess Brands—positioning it to enter bankruptcy for the second time in as many years. Will the beloved  Twinkie survive? Silver Point Capital, L.P. is a privately-owned hedge fund sponsor based in Greenwich, CT.  Their specialties include investing in securities of distressed, large-cap, and mid-cap companies. It was founded in 2002 by two former Goldman Sachs … [Read more...]