By Dan Primack
November 9, 2012

FORTUNE — Yesterday I wrote an obituary for “uncertainty,” the catch-all excuse used by CEOs who have chosen to hoard cash rather than spend it on new employees, acquisitions or other expansion activities.

Since then, some folks have emailed to let me know that I’m “an idiot.” And “stupid.” And (my favorite) “someone who knows less about business than my son, who won’t be born for another month.”

But this morning I got some backup from David Rubenstein, co-founder and co-CEO of The Carlyle Group (CG). During the Q&A part of Carlyle’s third quarter earnings call, Rubenstein was asked if the private equity fundraising environment is poised to rebound. Here is the beginning of his reply:

“Well, we hope that will be the case for sure. No doubt that the U.S. economy slowed down a bit in the second and third quarter compared to what had been projected. And I think some of that was uncertainty that where the election was going, and now as that’s resolved, I expect that people will say okay, I’m not going to wait four more years for another president, I’m going to start doing capital expenditures and investing again.”

But he doesn’t know about business, right? He only helps run the world’s largest private equity firm…

Some other choice comments from the call:

  • Rubenstein: “After the lame-duck, we expect that comprehensive tax reform will likely be only agenda of the new Congress and the President. However, we expect that any comprehensive reform will take at least two years. In the context of this reform, carried interest taxation and a great variety of other issues will no doubt be addressed.”
  • Bill Conway: “The trajectory of our internal data on Europe changed during the quarter. Rather than steep declines has had been the case for most of 2012, recent data suggest signs of stabilization. One of our proprietary European indicators, which accurately predicted about five months in advance the European contraction that began in October 2011, is currently showing signs of modest growth.”
  • Conway:  “We see surprisingly rapid growth in household spending in Brazil, but in Japan we are seeing a worrying decline in industrial output. We are monitoring Japan closely to determine whether the decline is limited to Japan or has broader implications. Keep in mind that the economic environment is not the same as the investment environment. In fact we think this is a great investment on which to invest on a very disciplined basis even with weak and mixed macro growth signals.”
  • Conway:  “You will note that more than half of these investments and virtually all of the larger ones were made in the United States with 62% of the equity for the committed transactions in the U.S. industrial and manufacturing sectors. There is a reason for this. To put it bluntly, we believe that the best place in the world to invest today is the United States.”
  • Rubenstein: “I’m concerned now that the markets are extremely frothy and that we’ve never seen rates this low. I would say the underwriting standards of the banks though are probably not as loose as they were in the 2008/2009 – 2007, 2008, 2009 period, but anytime we’ve got rates at these very, very low levels. And nevertheless what’s fueling this is that the central banks print all this money and investors everywhere are seeking return and yield…. And I think from the standpoint of the Carlyle’s responsibility to our limited partners and our unit holders, we’ve responsibility to really take advantage of this while it’s being offered. And on the other hand, we also have the responsibility to be positioned for the fact that it’s not going to go on forever. And so, for example, you’re not just trying to borrow money and use the benefit of these short-term very low rates or – in the short run very low rates, but also you’re trying to make sure that you have confidence that give you extreme flexibility that you have revolvers that can be used maybe for a time when things aren’t as cheap as they are today.

Sign up for Dan’s daily email newsletter on deals and deal-makers:

You May Like