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Private equity buying accelerates shooting market up -but how long can it continue?
Maria Hernandez
May 21, 2007
You may think market is going down. All technical indicators are bearish except one. There is tremendous amount of money in the hands of private equity groups - the wealthy Americans. The accumulation and distribution models provide some indication that there can an additional one trillion dollars in the hands of these private equity groups and wealthy individuals ready to take the markets for a ride.
There is just one catch. If real estate falls further, these private equity groups that took out enormous cash out from their real estate holdings will collapse taking the market with it.
According to some think tanks, real estate is in deep trouble and these wealthy families do not have a clue that their prized real estate holdings soon will have negative equity. That can start the roller coaster in the stock market. If the stock market and real estate market both collapse, it will be a massive blood bath in hedge funds, private equity funds, and even in commodity trading
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