David Rubenstein, co-founder of the renowned private equity firm Carlyle Group, says we’ve passed through the most damaging portion of the financial storm.
“I think the worst of the recession that we’re in is probably over,” he tells Bloomberg TV.
“The stock market reflects probably some pickup. We’re not past all the problems … but generally I think the worst is behind us.”
Rubenstein sees economic growth returning by year-end.
“We see … some pickup in sales. We see some new orders,” he says. “I wouldn’t say it’s overwhelming yet, but we do think there are some positive signs.”
As for the private equity industry, Rubenstein says firms are ready to invest, “but I think sellers are still a little bit wary of selling at the price we would like to pay. There’s probably about a 30 percent gap between sellers and buyers.”
That gap should shrink by year-end, he says.
“And as financing comes back, I think that by the beginning of next year, you’ll begin to see deals being done in the $1 billion to $3 billion range … and pick up by the middle of next year.”
Rubenstein points out that “the best deals … ever done are generally done at the bottom of a recession or near the end of [it].”
Many agree with his views about the economy. Economists Brian Wesbury and Robert Stein of First Trust Advisors go even further. They argue that a V-shaped recovery has begun this month.
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