Stephen Schwarzman, chairman and chief executive officer of The Blackstone Group, and David Rubenstein, a founder of The Carlyle Group, appeared yesterday on The Charlie Rose Show, an interview programme broadcast on US public television.
The interview was conducted by guest host Maria Bartiromo, a television reporter from financial news service CNBC. The interview can be seen here.
According to a transcript of the interview, Schwarzman called the Sarbanes Oxley regulatory regime “probably been the best thing that’s happened to our business and one of the worst things that’s happened to America”.
The comment came in response to a question from Bartiromo, who asked what factors were “fueling the boom” in private equity recently.
Both Schwarzman and Rubenstein said their firms have recently been deluged with interest from the managers of publicly traded companies, some with market capitalizations of more than $100 billion, who want to pursue privatisation.
Rubenstein attributed this to the “tyranny of quarterly earnings”.
Both private equity leaders argued that regulatory strictures in the US are sending financial business elsewhere.
“[F]or most Americans, it was recognised that the centre of capitalism was thought to be the United States, and perhaps New York,” said Rubenstein in the interview. “Now, that’s changed. And we have to recognise that people can get along quite well without coming to the United States, investing in the United States or listing their companies in the United States. And if we don’t adapt to this reality, we’re going to, I think, hurt our economy a great deal.”