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Did the Regulators Just Ring the Bell on the Deal making Spree of 2009-2014

Phoenix Capital Research's picture




 

Most analysts miss major changes in the financial system.

 

The reason for this is that they only look at the economic data for signs of what’s happening. If you’re looking for a competitive edge in your forecasts, however, you need to learn to “read between the lines” on news releases.

 

Which is why I believe 99% of analysts are overlooking the following story (hat tip Bill King’s King Report).

 

Three longtime banks for private equity firm KKR & Co LP (KKR.N) have snubbed a request for a $725 million buyout loan over concerns it is too risky to pass muster with U.S. regulators, sources familiar with the situation said on Thursday.

 

The banks had funded a similar deal six months earlier…

 

Now, the three banks have refused to bankroll a bid by KKR-owned Brickman to buy rival landscaping company ValleyCrest Companies LLC, as they seek to cut back on making new loans that do not comply with the leveraged lending guidelines, the sources said. Dell Inc DELL.O founder Michael Dell's investment firm owns ValleyCrest.

 

It is unusual for banks that lead the financing of a leveraged buyout of a company not to be tapped for smaller follow-on financings.

 

            Source: Reuters.

 

KKR is one of the premiere name brand private equity firms in the world. Here we find that “longtime” banks, or banks that have done business with KKR for decades, have decided NOT to fund a KKR deal due to new leverage guidelines.

 

Even the article itself notes this is unusual.

 

This story is of MAJOR importance as it indicates the following:

 

1)   The deal-making spree of the last 3 years is peaking out.

2)   New regulations are beginning to affect the wave of liquidity that has buoyed stocks in the last 5 years.

 

Does this mean stocks will collapse right now? Not necessarily. But it is a clear sign that things are changing behind the scenes in the financial system.  The smart money is taking note… will the rest of the market?

 

In time…

 

 

This concludes this article. If you’re looking for the means of protecting yourself from what’s coming, you can pick up a FREE investment report titled Protect Your Portfolio at http://phoenixcapitalmarketing.com/special-reports.html.

 

This report outlines a number of strategies you can implement to prepare yourself and your loved ones from the coming market carnage.

 

Best Regards

 

Phoenix Capital Research

 

 

 

 

 

 

 

 

 

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Wed, 06/04/2014 - 12:08 | 4823469 dizzyfingers
dizzyfingers's picture

Cronyism never goes away, it's always there, we simply don't look -- we think voting and other pretensions solves everything. Voting solves nothing, is pretension of "power" not reality. Everyone on the ballot serves "special interests". The reason I say those things is that I've been voting for more than 50 years, and nothing has ever gotten better, it's always worse with each election, doesn't matter which party's "in power". That last phrase explains everything. The party system camoflages the next TPTB level.

Wed, 06/04/2014 - 09:39 | 4822867 Clam McCain
Clam McCain's picture

I havent been on here for a couple of years now...and this guy is still peddling the same crap?

Wed, 06/04/2014 - 08:53 | 4822672 Notsobadwlad
Notsobadwlad's picture

 The failure of Bear-Sterns did not happen overnight. They still had friends. But at the very top of the power chain a decission was made to cut them loose. And, as is the code, they did not complain much. My guess is that the reason that Bear and Lehman were cut had as much to doo with Jimmy Caine and Dick Fuld as anything else. They did not fit smoothly into the club, but they were still given its protection and they obeyed the rules.

Wed, 06/04/2014 - 08:12 | 4822539 buzzsaw99
buzzsaw99's picture

if dell & kkr are involved you know someone is getting hosed

Wed, 06/04/2014 - 07:53 | 4822518 AdvancingTime
AdvancingTime's picture

Crony capitalism is taking its toll on all of us. I recently found myself thinking about the decline or collapse of great empires and realized that it is often hard to predict when or how their demise will occur. One sign of the end is a massive growth in crony capitalism and corruption. Many analogies can be taken from this idea, the empire need not be great and timing is always hard to correctly gauge.

The signs of decline may be everywhere but that does not guarantee the end is near. As the foundation crumbles away it is not uncommon for those in power to extend their rule by many tricks and changing the rules in order to gain a new lease on life. More on the subject of how empires collapse in the article below.

http://brucewilds.blogspot.com/2014/05/how-empires-collapse.html

 

Wed, 06/04/2014 - 08:55 | 4822677 Notsobadwlad
Notsobadwlad's picture

Cronyism never goes away ... it simply submerges here and there throughut history, only to emerge later as if it never went away at all/

Wed, 06/04/2014 - 08:19 | 4822552 Comte d'herblay
Comte d'herblay's picture

What the "Foundation" consists of is the best predictor of when some entity or structure will collapse (or not).

If the foundation of our world is, for instance, manufacturing, making stuff we can see and manipulate, and manufacturing begins  to erode so do the  jobs that go with it and the middle and poor classes who do the work become redundant or obsolete.

If the foundation of our world is paper money, it may flourish forever or as long as paper money is acceptable as a medium of exchange.

Without rampant inflation (see Europe's problems with deflation and how they are attempting to ratchet up the 1.2% inflation (stripped of course of the Food, fuel and housing that most people who are not homeless need to survive) to the 2,3% range, a nearly 100% increase over current levels) it is unlikely that a collapse would occur a la Zimbabwe and other historical events requiring wheelbarrows of money to buy a loaf of hash. 

Financial Empires, if controlled by a few, can be fairly sturdy structures, immune to dislocations caused by technological change. (The car replacing the horse and more accurately, the buggy, and the whips that spurred them on).

Wed, 06/04/2014 - 07:30 | 4822490 Comte d'herblay
Comte d'herblay's picture

History: a fiction written by propagandists, usually the winners, never repeats.

While it may rhyme from time to time, remember, it was a fiction written by propagandists, usually the winners.

What it certainly is not, is the truth.

See the article here for proof on War as Profit opportunities:

 

http://www.zerohedge.com/contributed/2014-06-03/war-banker-racket-explai...

Tue, 06/03/2014 - 23:38 | 4822161 Atticus Finch
Atticus Finch's picture

"New regulations are beginning to affect the wave of liquidity that has buoyed stocks in the last 5 years."

There are regulators in the US? Who would have thought?

Tue, 06/03/2014 - 16:47 | 4821225 NOZZLE
NOZZLE's picture

Brickman, a fucking yard raking company w8th rusty dented trucks and toothless Mexican scumbag criminals pushing lawn mowers around and blowing garbage all over the streets omehow qualifies for three quarters of a billion dollars to buy another Mexican employment agency.

Tue, 06/03/2014 - 21:16 | 4821801 Tapeworm
Tapeworm's picture

NOZZLE. That is what hit me first about a "Landscaping" company. What's the total net worth of their employees? $27,453.24?

Tue, 06/03/2014 - 12:35 | 4820414 ebworthen
ebworthen's picture

That would create a huge monopoly in the landscaping business.

I can see why the regulators would block it.

If it were a media company = done deal.

Ban private equity firms.

They screw things up.

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