September 25th, Weekly Update

This week we are looking at the frightening future of private equity. We have previously talked about the biggest private equity money manager in our September 1st update, but now we are diving into what private equity is. Private equity is a partnership between people or groups that focus on 5-7 year investments. They use huge lump sums of money to buy stakes into a business or other ventures. They usually get these massive amounts of money for these deals—the term for this is leveraged buyout— by borrowing from pension plans, endowments and other major institutions. Due to very low interest rates, private equity has become a money mine. Private equity has gone into the medical industry buying up tons of practices and raising prices to an exponential amount, which is why the medical industry makes up 17.7% of the GDP. Not only that, but Blackrock has gone into the housing market and is projected to own 60% of houses in America by 2030. The SEC has tried to make rules to lessen the power of these money managers but immediately get counter sued and lose due to the amount of lawyers firms like Black Rock have. To end off this update I will list off a minuscule amount of companies Black Rock own. They own top equity holdings in Apple, Microsoft, Google and Amazon; they own majority shares in CNN, FOX News, Ford, Pfizer and much more.