An increase in exit activity would allow general partners to provide limited partners with long-awaited liquidity, enabling them to recycle capital back into new PE funds.

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But to get the trade-off between 10-year government bond, not in America, but on a global basis, and the inverse of the PE or the earnings yield back to historical norms, long-term interest rates would have to fully double from here globally.

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By late 2011, the PE recovery had petered out and conditions largely reverted to what they had been back in early 2010.

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Therefore with the shares trading at about a 10x PE multiple the company can essentially create a 10% return on the money when it buys back shares while only losing 1% in interest.

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