News & Analysis

When will America's party end?

With default rates in the US at historic lows, financial sponsors of leveraged buyouts, as well as the providers of that leverage, are feeling confident about the future. But are seeds of destruction being sown amid the optimism? By Wanching Leong.

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In an interview with the Wall Street Journal this past January, the notoriously reticent Kohlberg Kravis Roberts co-founder George Roberts brushed off two concerns – one, that the boom in private equity activity is a bubble and, two, that private equity firms are loading up the companies they buy with inordinate amounts of debt.