Capitalisn't Trump's Great Private Equity Bailout, with Dan Rasmussen
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Aug 21, 2025 
In this discussion, Dan Rasmussen, founder of Verdad Advisors and author, dives deep into the landscape of private equity. He critiques the recent push to allow 401(k) investors access to alternative assets, raising concerns about the true performance of private equity compared to public markets. The conversation tackles whether private equity is a viable option for retirement funds or merely a risky venture. Rasmussen questions the sustainability of returns and highlights the potentially adverse effects on everyday investors.
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Original Private Equity Edge Eroded
- Private equity's early formula was buy small, use leverage, and sell at higher multiples to earn outsized returns.
- Increased competition and higher purchase prices eroded that edge over the last 15–20 years.
Distributions Have Collapsed
- Distributions to investors have sharply slowed: capital calls have outpaced distributions by ~$1.5T since 2018.
- For recent vintages distributions are far below historical norms, creating liquidity stress for allocators.
Tiny Market, Massive Allocations
- Private equity is a small, highly leveraged corner of markets: ~12,000 firms worth ~$2.4T equity with ~$3T private credit.
- Yet large endowments allocate 40–50% to it, creating a striking concentration mismatch.
