The Federal Reserve cut rates again, but analysts say cheaper money won't fix private equity's (PE) massive problem. Traditionally, they'd take companies public on the stock market for huge profits, but that exit door has narrowed shut, down 46% in 2024 from the previous five-year average.1

"Private equity firms are increasingly trading assets among themselves or accepting lower returns," Kevin Khang, Vanguard's senior international economist, noted in recent analysis.2 "The $11 trillion industry's aggressive use of leverage, which once defined the model, is now being reined in, forcing a strategic rethink." READ MORE