I was looking into the new, probably AI, data center being built in town and noticed it’s built by a private equity backed firm. The data center was rejected by the city and has to operate with a standard cooperate building water supply. They said are switching to air cooling only and reducing the compute power to keep power usage the same. This has caused amazon, the alleged operator, to back out. So they are building a giant reduced capacity data center with no operator and apparently still think that’s a good idea. My understanding of the private equity bubble is that the firms can hide “under performing” assets because it’s all private. From what I read, possibly 3.2 Trillion dollars of it. I feel like this new data center is going on the “under performing” pile.
The thing with PE is they only invest what they’re willing to lose, which the vast majority of their investments do, but the tiny fraction that don’t make enough money to fund profits and cover losses.
If 95% of companies in the stock market lost money, that’d be the end of days, but that’s because generally once you graduate to an IPO you have to be pretty profitable.