<p>Well, I must live in the wrong part of the country. I don’t think San Francisco has seen those declines or cap rates.</p>
<p>Those are some serious declines in prices and big moves in cap rates. I’m hearing around here cap rates have moved up 50 basis points.</p>
<p>“As far as real estate the problem is that these private equity/hedge funds own the riskiest portion of highly leveraged real estate. So when you own the most exposed 10% and the value goes down 35% you are pretty clearly at zero. Same things with companies the private equities bought. Look at the companies going bankrupt-pretty much all bought by private equities and the leverage killed them.”</p>
<p>Ugly. And then there are capital calls on top of this.</p>