<p>All those counting on working in the field may be in for some disappoinment.</p>
<p>[Business</a> & Technology | Smart guys know where dumb money is | Seattle Times Newspaper](<a href=“http://seattletimes.nwsource.com/html/businesstechnology/2004109904_dumbmoney06.html]Business”>http://seattletimes.nwsource.com/html/businesstechnology/2004109904_dumbmoney06.html)</p>
<p>All that article is saying is that stock prices of those funds that have gone public has fallen. it doesn’t bode any great danger to the asset class as a whole. the world of pe and hfs operated fine before fortress’ ipo and will continue to do so. it also isn’t surprising that in this market, where nearly every company with credit exposure is feeling a crunch, that pe stocks are getting hurt. however, fact of the matter is that pe/hf’s are a legitimate asset class. alternative investments have matured since early 2000s to the point where they have viable infrastructure to be there for the long haul. before that, once the principal of a pe/hf retired, the firm was folded (think steinhardt). nowadays, these firms have institutionalized and it has been shown that they are an asset class that provides diversification. these firms will keep on attracting fof/pension fund money, generating fees. so i don’t expect offerings to end soon. </p>
<p>think of pe/hfs as the mutual funds firms of during 1990. the mutual fund industry grew from managing 1 trillion to in excess of 5 trillion now. you had firms during the 1990s, that had built the necessary infrastructure, going public. pe/hfs are doing the same. no need to think that the business models of these firms are poor. the current market simply isn’t conductive of raising loads of money going public for the principals so they will just wait it out.</p>
<p>Fees are outsized compared with recent performance and cheap borrowed money is gone for the near term. It may not come back as strongly.</p>