Goldman Sachs GS chairman and CEO Lloyd Blankfein knows that there haven’t been too many IPOs in the past 14 months, but believes that the backlog will be cleared at some point in 2016.

Blankfein was speaking on Tuesday morning at the Credit Suisse Financial Services Forum, when he said: “Companies that need to finance tend to be moved back in the queue, but they still get done. You see a lot of pent-up IPO demand, especially as the private funding is drying up a bit. We expect more IPOs.”

In terms of mergers and acquisitions, Blankfein pointed out that last year’s record volume actually came in below prior cycle peaks when adjusted for overall market cap. He added that there is still a lot of corporate consolidation opportunity, particularly in areas like industrials, mining, energy, food, media and telecom — although cautioned that such interest will be difficult to satisfy “if the financing markets don’t cooperate.”

US Foods, an Illinois-based foodservice giant with more than $23 billion in annual revenue, on Tuesday filed for an initial public offering.

The company says that it plans to raise $100 million, although that is almost certainly a placeholder figure that will increase as the listing gets closer. US Foods plans to trade on the New York Stock Exchange under ticker symbol USFD. No underwriting banks were identified.

US Foods had been owned by Dutch retailer Royal Ahold until 2007, when it was acquired by private equity firms Kohlberg Kravis Roberts & Co. KKR and Clayton Dubilier & Rice for $7.1 billion in cash. The company had agreed in 2013 to be acquired by Sysco SYY , but the deal was terminated last year following U.S. regulatory objections.

For fiscal 2014, US Foods reports a $73 million net loss on around $23 billion in revenue. This compares to a $57 million net loss on $22.3 billion for fiscal 2013. The company also reports a $177 million profit on just over $17 billion in revenue for the 36 weeks ending Sept. 26, 2015. That most recent period was boosted by $288 million in net revenue related to the Sysco agreement termination.

The private equity markets have begun experiencing a major slowdown in new deal activity, due to a contraction in the market for high-yield debt. More specifically, banks are having a tough time placing such bonds, which even has caused some already agreed-upon deals to be delayed and/or restructured (e.g., The Carlyle Group’s purchase of data storage business Veritas from Symantec).

Now, things might be about to get even worse.

Thomson Reuters on Friday published data showing that the credit crunch isn’t limited to high yield. Instead, U.S. marketed investment grade debt issuance is down 19% compared to the same period in 2015, despite a massive $45.6 billion loan package to support Anheuser-Busch InBev’s BUD pending purchase of rival brewer SAB Miller. Moreover, the actual number of new issues is off 45% year-to-date, making it the slowest start to any calendar year since 1996.

Given all of this, it should be interesting to see pricing and maturity specs when banks begin pitching a $4.7 billion debt package related to Apollo Global Management’s APO proposed $7 billion buyout of ADT ADP , which was announced earlier today.

Another debt-laden deal to keep an eye on is Dell Inc.’s $67 billion merger with EMC, which was agreed upon before the credit markets really began to crunch.

It remains unclear if President Obama will get U.S. Senate consideration (let alone approval) for his upcoming Supreme Court nomination, but one name being floated is that of Deval Patrick, the former Massachusetts governor and Department of Justice attorney who last year joined private equity firm Bain Capital to lead a new “social impact” investment platform.

It’s a pretty intriguing proposition, given Obama’s 2012 electoral tangle with Bain Capital founder Mitt Romney.

Patrick, however, is telling folks that he isn’t heading to Washington, D.C.

Instead, Patrick has told sources that he remains committed to his work at Bain, even though the Boston-based firm has not yet announced any additional hires for the social impact platform, nor has it begun marketing a social impact fund. One source says that the startup process was always expected to be lengthy, given that there is not really any established template for what Patrick is trying to launch, and that some news should be forthcoming within the next couple of months.

All of this sounds like exactly what Patrick needs to be saying right now, particularly given the relatively unlikelihood that he’d be nominated. As for whether he’d really turn down such a weighty presidential request, however, is another thing entirely…

Shamrock Capital Group, a private equity firm that was originally founded as a family office for Roy E. Disney, later today will announce that it has raised $700 million for its fourth flagship fund.

Los Angeles-based Shamrock focuses primarily on buyouts and growth equity investments for media, entertainment and communications businesses. Current Shamrock portfolio companies include FanDuel, Recorded Books and Screenvision, while past investments have included the Harlem Globetrotters, Learfield Communications and RealD RLD .

“Around two-thirds of our deals over time have been for control positions, but we’re agnostic when it comes to majority versus minority ownership,” says Steve Royer, a partner with Shamrock since 1998. “Even when we take minority positions, we’re not passive investors.”

Shamrock previously raised $400 million for its third flagship fund, with Royer saying that the step-up is intended to reduce the need for co-investments. “It just gives us a little more flexibility to do the same types of deals,” he explains.

No investor information was disclosed, except Royer confirmed that the Disney family is no longer a limited partner.

In conjunction with the fund close, Shamrock has made three promotions: Alan Resnikoff to partner, Laura Held to principal and Bhuvan Jain to vice president.

In late 2012, I wrote about how private equity giant TPG Capital was going to have troubles raising its seventh flagship fund (which wasn’t yet in market), primarily due to poor performance. Two years later, I changed my tune for three basic reasons:

(1) Performance had improved;

(2) The firm had endeared itself to limited partners by apologizing for its massive mistakes (i.e., Washington Mutual & TXU), plus by covering most of the LP portion of its collusion case settlement;

(3) By choosing to target less than half of the $19.8 billion it had raised for Fund VI in 2008 (the new fund targeted $8 billion with a $10 billion hard cap).

“TPG is going to get this thing done,” I wrote. And indeed it’s about to, per sources familiar with the situation (and this Reuters report).

TPG had originally planned to hold its final close at $10 billion on January 15, but received an extension through the end of April so as to accommodate the calendar needs of a few laggard LPs. Expect the actual final close to occur by the end of March. Also, the final number should be closer to $10.4 billion, given that TPG’s partners had pledged to invest the lesser of $400 million or 5% of the fund total.

To date, TPG VII has committed approximately $2.1 billion to six deals (i.e., around 20% of the fund total).

It also is worth noting that TPG had offered a fee structure choice to LPs who committed early:

(1) A traditional 1.5% management fee that would step down to 75 basis points after the initial commitment period; or

(2) Basically the reverse, which TPG has referred to as a “J-curve mitigation structure.”

The LP response was largely split, with a few more early investors taking the latter option. From TPG’s perspective, it’s take will be roughly the same either way.

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It’s also worth noting that TPG didn’t spook investors by unveiling plans to go public, despite some recent high-profile hires in that direction. In fact, my sources say that TPG still has not begun any actual IPO planning work.

Just to get a sense of how TPG has turned around its recent fund performance, take a look at theis internal rates of return (IRR) data from the University of Texas Investment Management Co. (UTIMCO):

* TPG V
2/29/12: -5.54%
11/30/15: 5.16%

* TPG VI
2/29/12: -1.06%
11/30/15: 12.1%

A TPG spokesman declined to comment on fundraising.

Michael Lebourgeois is quietly moving on from NGP Energy Technology Ventures, in order to form a New Orleans-based private equity firm called Black Bay Energy Management.

Lebourgeois (who did not return a request for comment) is the second NGP Energy Technology Ventures partner to leave in the past year, following Chris Sorrells (who now serves as interim COO of publicly-traded NGP ETV portfolio company GSE Systems). Moreover, he is being joined at Black Bay by NGP ETV principal Tom Ambrose (who will be a Black Bay partner) and associate Matthew Schovee.

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Black Bay’s third partner will be Guy Cook, who previously was a senior executive with Superior Energy Services.

NGP ETV has fully invested the $348 million second fund it raised back in 2009, and continues to manage 16 active portfolio companies. The firm’s two Washington, D.C.-based partners still plan to raise a third fund at some point, although timing and size remain undetermined. Managing partner Phil Deutch declined comment.

It is unclear how much capital Black Bay is seeking for its debut fund, or when it is expected to close.

Venture capital investments and valuations may be on the decline, but venture capital fundraising is doing just fine.

Case in point is Battery Ventures, which today will announce that it has raised $650 million for its eleventh flagship fund, plus another $300 million for a side fund to support larger investments. The $950 million total is a bit more than the $900 million that Battery raised for its tenth flagship fund and sidecar back in February 2013.

“We are focused on investing in innovation cycles, not business cycles,” says Battery general partner Michael Brown, who has been with the firm since 1998. “The innovation cycle still has a very long-term time horizon, particularly in enterprise and consumer tech where we still have big macro headwinds.”

Battery is stage-agnostic, backing tech companies from the early stages up through leveraged buyouts (albeit more of the former than the latter). Current portfolio companies include Blue Jeans Network, GlassDoor.com, HotelTonight, Narrative Science, Practice Fusion, and Sprinklr. The firm also yesterday got a big win by agreeing to sell Brightree, a Georgia-based provider of business management and clinical software to the post-acute care market, to ResMed RMD for $800 million.

No changes to investment strategy on this fund, but the partnership itself looks a bit different. As had been previously announced, longtime partner Dave Tabors stepped down, while new general partners include Chelsea Stoner (named a general partner in the middle of Fund 10), Dharmesh Thakker (ex-Intel Capital) and Russell Fleischer (ex-CEO of HighJump).

The 23 year-old firm has offices in Boston, San Francisco, Menlo Park and Israel.

Several media outlets last week reported on $125,000 in recent campaign donations made by California-based private equity executive Robert Smith and his wife to Eric Schneiderman, the New York attorney general who in 2012 subpoenaed at least a dozen private equity firms over possible tax-dodging activity. On the surface it looked pretty bad, particularly given that Smith and his out-of-state colleagues from Vista Equity Partners have become some of Schneiderman’s largest backers, having previously contributed another $182,000 since 2010.

After investigating the situation, however, we’ve found no evidence of conflict.

Schneiderman’s 2012 investigation was related to something called “fee waivers,” a controversial strategy through which private equity fund managers lower their tax bills by reclassifying management fees (on which they pay ordinary income tax rates) as fund commitments (on which they would pay capital gains rates, assuming investment profits). You may recall this being raised as a national issue during the 2012 presidential race, due to the use of “fee waivers” by Mitt Romney’s former firm, Bain Capital.

The case is currently under court seal, but multiple sources tell me that Schneiderman’s legal standing was something called the New York False Claims Act. This particular rule is specific to New York-based entities or, in the case of alleged tax fraud, those paying substantial state taxes in New York. So a firm like Bain Capital - which is based in Boston but has a satellite office in New York - was subpoenaed. Vista Equity Partners - whose offices are in California, Illinois and Texas - was not (even though it has allowed for the use of fee waivers).

In other words, Vista’s exclusion was about basic geography rather than about generous campaign contributions.

Moreover, a source familiar with the investigation says that it never ultimately went very far, in large part because outside counsel for the private equity firms attested to having designed fee waivers in the first place, thus making it much tougher to pin false claims on the firms themselves (which had to have “knowingly” flouted the law).

So why is an out-of-stater contributing so much to a New York AG in the first place?

Sources say that Robert Smith and Schneiderman met several years ago via a mutual friend, and bonded over a love of jazz music and various other nonprofit endeavors. For example, Schneiderman is a supporter of the Louis Armstrong House Museum in Queens where Smith sits on the board, and both have the same photo of Armstrong hanging in their offices. The two men also each attended a New York City gala for The Opportunity Network last year, and Smith’s wife is said to have particular interests around foster care and human trafficking - two issues around which Schneiderman has taken strong stands.

“To avoid even the appearance of a conflict between the duties of his office and the need to raise campaign contributions, every contributor to Attorney General Schneiderman's campaign committee is vetted and required to certify that they and the entities they own or control have no matters currently pending before, or recently resolved, by his office,” says Damien LaVera, communications director for the AG’s office. “A full and complete review of Eric Schneiderman's record would paint a clear picture of an Attorney General who will go after anyone who tries to take advantage of New Yorkers no matter how rich or powerful they are, or to whom they have given political contributions.”

Yahoo Inc. is on the block. Again.

The last time we went through this was in 2011, when several private equity firms kicked the tires pretty hard, but ultimately bounced off. This time the board seems more serious, however, last week announcing the creation of an independent committee to explore strategic alternatives. So let’s lay some odds on the reported suitors, for a takeover of Yahoo’s core Internet assets that sources believe could be worth anywhere from $3.5 billion to $6.5 billion:

Verizon Communications (2:1)

“This is Verizon’s deal to lose,” says a longtime tech banker who believes that Yahoo will ultimately “go to the highest bidder.”

For starters, Verizon VZ can afford to be that bidder. It has a market cap of $208 billion, and nearly $5 billion of cash on its balance sheet. Second, CEO Lowell McAdam has been unusually public about his interest in buying Yahoo YHOO , perhaps in an effort to discourage other bidders. Third, Verizon actually has someone already in place to run the show, in the form of AOL CEO Tim Armstrong. It might be a bit personally complicated for Armstrong to dethrone his old Google colleague Marissa Mayer, but integrating Yahoo’s giant audience and content with AOL could boost Verizon’s competitive position in vital areas like mobile video.

The only hangup here could be pressure from Verizon shareholders, who may not be so sure that buying yet another first-generation web portal is really a step toward the future. Plus there is a big wireless spectrum auction coming up, and those megahertz won’t come cheap. That’s why Verizon will really want to keep the price low, even though it technically could afford to pay up.

Time Inc. (8:1)

At first blush, this doesn’t seem to make much sense. After all, Time Inc., Fortune’s publisher and my employer, has a market cap of just $1.5 billion and only $651 million in cash. But smaller companies can effectively acquire larger ones via something called a Reverse Morris Trust. Here’s how it would basically work:

• Yahoo Inc. would create a subsidiary to hold core Yahoo.
• That subsidiary would then merge with Time Inc. to create a new company. Let’s call it TimeHoo.
• TimeHoo would issue enough shares to Yahoo Inc. shareholders that it would give them both economic and voting control of TimeHoo.

Because of the Reverse Morris Trust rules, neither Yahoo Inc. nor its shareholders would be taxed on this new distribution, so long as Time Inc. TIME can convince regulators that this transaction was not part of a longer-term plan that kicked off when the company was spun out of Time Warner TWX back in June 2014. This tax strategy could theoretically give Time Inc. some pricing advantage in a competitive auction process.

Mathew Ingram has more on the strategic rationale here, which is a bit reminiscent of the rationale behind Time Warner’s ill-fated merger with AOL in 2000. Basically, Time Inc. would feed its premium content into Yahoo’s massive audience, thus serving higher-priced ads to more people. It’s basically the third leg of a stool that Time Inc. began building earlier this month by purchasing programmatic ad platform Viant. Well, perhaps a lopsided stool, as multiple sources say that Viant was valued at a deep discount to the $300 million pre-money valuation its predecessor entity received from private equity back in 2011.

Time Inc., via a spokesman, declined comment.

Private Equity (10:1)

Around a dozen private equity firms are circling Yahoo right now, and ringing up various outside executives to see if they would have interest in serving as post-acquisition CEO. In fact, multiple sources say that current Yahoo CEO Marissa Mayer also has reached out to private equity firms - via banker Frank Quattrone - about possibly fronting an offer of her own.

Back in 2011, interested private equity firms were primarily interested in Yahoo’s Asia assets, which wouldn’t be in play this time around. Silver Lake (working with Microsoft and Andreessen Horowitz) and TPG Capital (working with Greylock Partners) each had a pretty similar plan:

1. Sell/spin off the Asia assets.
2. Use the proceeds to buy major Web 2.0 properties.
3. Cut costs.

Another 2011 offer from Bain Capital and The Blackstone Group BX focused mostly on the third part of that, because it was coming in partnership with Alibaba BABA and Softbank (which is co-owner of Yahoo Japan).

Even though a 2016 private equity bid wouldn’t include the Asia assets, it also would be designed around a similar thesis. For example, firms could pay six times EBITDA (i.e., $4.5 billion) with plans to cut costs down to three times EBITDA. Basically milk Yahoo for its legacy cash-flows. Most large buyout shops - with the notable exception of Silver Lake - have expressed at least mild interest.

To afford such a deal, however, all but one or two interested private equity firms would need to either club up with one another, or secure very large equity co-investments from their limited partners.

Other (12:1)

This is where I basically give myself some cover, by pointing out that Verizon and Time Inc. aren’t the only strategic buyers that could take a run at Yahoo. Many of the same strategic reasons the deal makes sense for Verizon also apply to AT&T ATT and Comcast CMST . Some of the Time Inc. thinking could also apply to a media company like Germany’s Axel Springer. And then there is the wildcard of Alibaba, which might try to buy core Yahoo as a way to get back the Alibaba stock held by non-core Yahoo. You also can’t rule out SoftBank (ever).

Or…

There is, of course, the very real option that Yahoo won’t be acquired by anyone. Again.

Perhaps Verizon’s top shareholders make too much noise. Maybe Time Inc. decides that finding audience isn’t its greatest challenge. Perhaps private equity firms can’t find debt financing in what has become a very tight credit market.

Or maybe bids do come through, but Yahoo’s board thinks shareholders would be better served by remaining independent. There is a case to be made that if Yahoo’s board really wanted to sell, it would have fired Mayer and promoted CFO Ken Goldman on an interim basis. Like all things with the Internet icon, this outcome isn’t obvious.

California’s public pension systems have at least $50 billion committed to private equity, and now a state legislator is asking for more transparency.

Assemblyman Ken Cooley (D-8th District) has introduced a bill that would require public pensions to collect detailed information on fees paid to the private equity funds in which they invest - both fees that are charged directly to limited partners like state pension funds, and also ones charged to the fund’s portfolio companies (which, indirectly, are taken out of pension pockets). The proposal would apply to all fund agreements signed beginning in 2017, and would require that the collected data be publicly disclosed at least once per year at an open meeting.

All of this comes after a series of revelations about how private equity firms essentially hide certain fees by shifting them to portfolio companies, plus a variety of other complicated schemes. The Securities & Exchange Commission has taken particular interest, reaching settlements with such firms as The Blackstone Group BX , Kohlberg Kravis Roberts & Co. KKR and Lincolnshire Management. The Carlyle Group CG also disclosed in a recent regulatory filing that it is the subject of an SEC inquiry into its fee practices.

To be sure, all limited partners in private equity funds should demand robust fee information from their general partners. As I’ve written before, one way to better accomplish this would be to simplify and standardize the fund subscription agreements. So, to that end, I applaud what Cooley is doing.

My concern, however, is that this legislation is papering over a much larger problem: An apparent belief that California pension fund managers (and their attorneys) either lack the sophistication or time to fully understand the agreements they are entering into.

And this worry is only exacerbated by the fact that Cooley explicitly says that this new requirement will not come with additional financial resources for the pension funds, meaning that these staffers will have even less time to sniff out troublesome language. Yes, the private equity funds will now be required to submit data, but only an audit would determine if such data is invalid or being shaded (something that the pension systems already could, but do not, conduct of their PE relationships).

There also is a secondary concern that certain private equity funds would use this bill as an excuse for no longer taking public pension money from California, but we also heard that threat 10 years or so ago when the California Public Employees’ Retirement System and the California State Teachers’ Retirement System began disclosing fund performance - and it mostly became a non-issue (in part because certain other states followed suit, which also could happen in this case).

Here is the proposed bill:

Assemblyman Cooley did not return Fortune‘s request for comment.

Fiscal conservatives should start panicking right...about...now.

Last Thursday's Republican primary debate in Houston may have been entertaining for socialists with a serious case of schadenfreude, but it was a total nightmare for moderate and fiscal conservatives hoping that cooler heads would have prevailed by now.

Normally, on the day before the all-important Super Tuesday primary blast, the GOP election machine would have successfully marginalized the outsiders, fresh-faced kids, troublemakers, and irrelevant candidates from the field of likely Republican nominees. You know, the Steve Forbes, Dan Quayles, David Dukes and Lindsey Grahams of the race.

One, possibly two, candidates would stand out from four or five left, giving the illusion that the GOP was actually letting the people choose their party's nominee. In the end, the level-headed fiscal conservative voter would make the rational choice, choosing a candidate who they believed could not only bring out the base, but also appeal to enough centrists, moderates, and conservative Democrats to win the general election in November.

Based on this formula, of the five remaining candidates on the GOP ballot tomorrow, Ohio Governor John Kasich should be at the top of the list. He is by far the most level-headed of the bunch and is the only candidate with any relevant executive experience. He is also the only candidate left with a record of balancing budgets and practicing, not just preaching, the basic tenets of fiscal conservativism by turning deficits into surpluses while keeping taxes low. He struck deals with Democrats to balance the budget and fought corrupt Republicans addicted to pork--and he did it with class.

But while Kasich is the only GOP candidate left who consistently trounces both Hillary Clinton and Bernie Sanders in head-to-head polls, he isn't expected to do well on Super Tuesday. Indeed, the avuncular Midwesterner is probably going to do terribly, finishing well behind billionaire (outsider) Donald Trump in every state. Kasich also trails Florida Senator Marco Rubio (the fresh-faced kid) in some states and Texas Senator Ted Cruz (the troublemaker) in others. Indeed, he may even finish below the (irrelevant) soporific surgeon, Ben Carson, putting him dead last in some states.

How could this be? Why would Republican primary voters reject a true fiscal conservative and vote for a bunch of inexperienced troublemakers, none of whom have presented a viable plan to kick the debt, grow the economy or fix healthcare? The leading candidates have instead promised a chicken in every pot, a blank check for the military, a wall on the nation's southern border, mass deportations of millions of (employed) illegal aliens, all while reversing everything done by the "wicked" President Obama.

To be fair, it's not unusual for politicians to overpromise while campaigning. Nevertheless, the Republican candidates this cycle have all presented tax and budget plans that go way beyond the typical election cycle fib--they are either totally irresponsible or totally incoherent.

Ted Cruz, for example, says he wants to get rid of the 35% US corporate tax rate and replace it with a 16% "business flat tax." At first blush it looks like corporations would see their tax bills cut in half. But the net effective tax rate for US corporations (what they really pay after loopholes and deductions) is somewhere in the neighborhood of 12%-13%, not 35%, according to the Government Accountability Office (GAO). So for many corporations, a 16% tax would cause their tax bill to go up, not down.

It gets worse: The new tax wouldn't be levied on a company's net profits as is the case today; rather, it would be levied on a company's gross profits, which is its total sales minus all the payments made to other businesses as well as all capital expenses. All other general business expenses, like utilities, advertising costs, insurance, and, most importantly, employee wages and benefits, would be subject to taxation by the government. Since labor would now be essentially taxable, the government would be pushing companies to hire fewer people. And those employees who managed to avoid the firing squad would see their benefits slashed.

But probably the biggest issue is that the plan simply doesn't add up. Along with eliminating the business tax, it also eliminates payroll and estate taxes, while cutting the national income tax to a flat 10% for everybody. Since rich people pay the bulk of taxes, this would erase a huge amount of revenue, which wouldn't be replaced by the "business flat tax." The Tax Foundation, a right-leaning think tank, estimates federal revenue would fall by $17.3 trillion over the next decade. Even with the rosiest of assumptions regarding economic growth, the Cruz plan still ends up in the red. That means further budget deficits and an increase in the national debt.

Marco Rubio's plan doesn't add up either, although it is a much better deal for the indigent. Those in the bottom 10% of earners would see their after-tax incomes shoot up thanks to a bevy of targeted tax credits, especially to those with children. So not only would they pay no tax, the government would also be cutting them a check. This would be an increase in spending to the tune of around $1.7 trillion over the next 10 years.

The bulk of the tax burden would then fall on the middle class, while the rich would actually receive a modest tax cut to 35%. But the rich make their money from inheritance and investments, which Mr. Rubio would make tax free by eliminating the estate and capital gains taxes. While this would be great for high earners and rich families, it would also deliver a huge blow to the nation's finances, which if weren't met with spending cuts would sink the country further into the red. But Mr. Rubio isn't really good at cutting. Indeed, he wants to increase military spending back by around $1 trillion over the next 10 years. To pay for that, he would have to introduce draconian cuts that could negate any of the benefits coming from the tax credits.

Lastly we have Donald Trump. His tax plan is probably the worst of all worlds, a mishmash of liberal and conservative ideas that would push the country into an abyss of red ink. His plan collapses the current seven tax brackets into three of 10%, 20%, and 25% and raises the standard deduction significantly, exempting individuals making less than $25,000 from paying any tax at all. Deductions would be limited, but the big one, the mortgage interest deduction, would be preserved. Corporate taxes would be slashed (or effectively increased) to 15%, depending on the company's net effective tax rate. Meanwhile, he would keep the capital gains tax rate at 20%, while taxing carried interest at normal tax rates instead of at the lower capital gains tax rate. The change in carried interest would cause Wall Street, especially private equity, to go apoplectic.

Despite this increase in revenue, the overall trajectory is still negative under the Trump plan. The Tax Policy Center estimates that if Trump failed to make draconian spending cuts, his plan would add $11.2 trillion to the national debt by 2026 and $34.1 trillion by 2036. Since he has promised to increase spending for the military and not cut Medicare or Social Security (or default on the nation's debt), he would need to decrease discretionary spending by about 82%.

Yeah, that's probably not going to happen.

Governor Kasich is also promising to lower tax rates, but he has proven that he can make the cuts necessary to pay for them. He made a lot of tough decisions as head of the House Budget committee in the 1990s. This is the guy who found the $10,000 hammers and $4,000 toilet seats in the defense budget and called the DOD out on it. At the same time, he worked with Democrats to reform entitlement spending. It is tough to see how any of his fellow candidates will be able to work with their fellow Republicans, let alone Democrats, to get anything done.

But with Kasich languishing in the polls, Super Tuesday will be a painful day for fiscal conservatives. Cruz, Rubio, and Trump have all presented fiscal plans that promise big tax cuts but which fail to balance the budget or pay down the national debt. We have learned over the last 30 years that financing tax cuts with debt is not an effective way to stimulate growth. It is only when those tax cuts come with major spending cuts that they can lead to an increase in growth and thus a balanced budget.

William Cohan's recent cover story in Fortune argued that "a reckoning is coming in the tech world." That prediction may or may not come true, as research shows that even expert forecasts are often wrong. But whether or not Cohan's prediction is correct, high enterprise valuations and IPO problems won't affect the VC or private equity industries very much.

That's because investment managers long ago mastered an important skill--the ability to gather assets under a compensation structure that makes them money almost regardless of how their investments perform. Here's how it works.

As everyone knows, VCs and private equity funds--the two are often lumped together in both industry reporting and academic research--collect 2% on all assets under management, and 20% of the gains the funds earn.

For many reasons, including low interest rates on fixed income investments, inconsistent stock market returns over the past decade, and effective marketing of their products, the alternative investment industry has been on a tear. According to Prequin, which publishes research on the industry, private equity and venture capital assets soared from some $1.2 trillion in December 2008, to $2.6 trillion in June 2014, an increase of more than 100% in just six years.

Two percent of the $2.6 trillion asset base is $50 billion in fees collected each year. No wonder that managers of alternative asset funds are among the most highly compensated people on the planet.

VC and private equity also seem firmly planted on a path to expansion, notwithstanding California's pensions system's decision to reduce its exposure to alternative investment products. Prequin's report notes that "investor appetite for the asset class remains robust and many LPs (limited partners) are below their target allocations." And in 2014, 994 funds raised more $495 billion--that's half a trillion dollars--in just one year.

Moreover, research suggests that VC compensation is not highly related to fund performance. For instance, a study of 419 venture capital partnerships formed between 1978 and 1992, co-authored by Harvard professor Josh Lerner, reported that the mean level of "base" compensation--management fees--averaged around 18%, while the sensitivity of compensation to performance--the amount total compensation grew if the asset growth rate went from 20% to 21%--was only about 4.5%. The study concluded that there was "no relation between incentive compensation and performance," and noted that base fees--the fees for overseeing assets not tied to performance--"are a significant fraction of venture capitalist's compensation."

But does performance affect the ability of funds to attract (and retain) assets?

Although research coauthored by University of Chicago professor Steven Kaplan shows that "better performing partnerships are more likely to raise follow-on funds and larger funds," it is nonetheless the case that there are diminishing returns to performance, "so top performing partnerships grow proportionally less than average performers." In other words, many funds are able to raise capital effectively almost regardless of their relative performance.

Cohan's analysis in Fortune focused on the poor performance of companies such as Twitter, Zynga, Groupon, and others whose stock prices have tanked after going public. But this share price decline is a problem only for those who bought at the public offering or invested shortly before the companies went public. Typically, VC investments are made early in companies' development and at much lower valuations. Therefore, VC--and for that matter, early employee--returns are stunningly wonderful whether the equilibrium enterprise value turns out to be $10 billion or "only" $2 billion. When I recently asked a former Stanford student now running his own small private VC fund how he could afford a house in one of the most expensive areas of San Francisco, his reply was that he had a job running the Indian operation for Zynga for a while. His options earned him a lot of money, notwithstanding Zynga's subsequent struggles.

And lest you think that liquidity concerns constrain the ability of private investors to get their money out of alternative investments, there are markets to trade both unregistered securities and interests in VC portfolios.

Because of the soaring value of assets under management and a compensation structure that bases rewards on the amount of those assets and not just performance, partners in the VC and private equity world enjoy enormous pay packages, with little sign of trouble on the horizon. Commentators need to not confuse what happens to VC's and their counterparts with what happens to those who buy investments as the VC's are exiting.

Jeffrey Pfeffer is Thomas D. Dee II Professor of Organizational Behavior at the Graduate School of Business, Stanford University. His latest book is Leadership BS: Fixing Workplaces and Careers One Truth at a Time.

Goldman Sachs partner John “Jack” Daly has resigned in order to join private equity firm TPG Capital as head of industrials, Fortune has learned. He will begin his new role later this year, at which point he will oversee TPG’s investment activities in areas like manufacturing, business services, distribution and transportation.

Daly originally joined Goldman Sachs GS in 1999, and most recently led a merchant banking group that made control investments in large industrial companies.

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The position at TPG has been open since early last year, when industrials head Kevin Burns stepped back in order to serve as an interim executive with yogurt maker Chobani (which had previously raised debt financing from TPG). Burns is now full-time at Chobani and no longer a TPG employee.

TPG’s interim head of industrials, Nathan Wright, will continue to work on the team.

TPG declined comment on the new hire, via a spokesman.

A former Watergate prosecutor is due to release a report on a court-ordered fraud investigation into a series of corporate deals involving Caesars Entertainment that could break a deadlock in one of the biggest fights on Wall Street over the bankruptcy of Caesars‘ casino operating unit, Caesars Entertainment Operating.

Richard Davis and a team of lawyers and advisers have spent a year trying to determine if Caesars czr fairly tried to rescue CEOC, or stripped away the best properties and left it with faded regional casinos and a crushing $18 billion of debt.

The examiner said in a court filing that the report would be filed under seal the week of March 7 with an outside date of March 14, along with a public summary of Davis’ findings. The full report will be made public in the weeks following the initial, redacted release.

The Chapter 11 proceedings have pitted aggressive players in finance against each other. Caesars and its private equity sponsors, Apollo Global Management and TPG Capital , have teamed up with Elliott Management. Bondholders are being led by Appaloosa Management.

(Read Fortune’s investigation into the Caesars bankruptcy: A private equity gamble in Vegas gone wrong)

Caesars has proposed injecting $1.5 billion into its operating unit to settle allegations of asset-stripping, and the examiner’s report could show whether or not that amount is fair.

But so far junior bondholders have refused to accept Caesars‘ plan, demanding that it inject more money into the bankrupt casino company which would be split into a real estate investment trust and a separate operating unit.

“The examiner’s report is not binding but it can be used as a roadmap for how to proceed,” said Jonathan Lipson, a professor at Temple University School of Law in Philadelphia.

In a best-case scenario for Caesars, formed by the 2008 buyout of Harrah’s Entertainment for $31 billion, Davis will say that most of the transactions were fairly valued.

But if Davis’ review of 8.8 million pages of documents and extensive interviews with over 70 witnesses determines transactions were improper or significantly undervalued, it could fuel attacks by creditors.

Appaloosa and other junior creditors have sued Caesars in different courts. The most advanced case, in federal court in Manhattan, has been stayed until 60 days after the release of Davis’ report.

Caesars has said it expects to win those lawsuits, but its advisers have testified that if the company loses it will wind up bankrupt.

U.S. Bankruptcy Judge Benjamin Goldgar of Chicago has already threatened to throw out the entire case if warring groups cannot come together and last month told the parties that it was “time to get cracking” on a way forward.

CEOC will provide an updated restructuring plan by March 23 and hopes to exit bankruptcy by Sept. 15, according to court documents.

Davis, who now has a private practice after more than three decades with Weil, Gotshal & Manges LLP, was a member of the Congressional investigation that resulted in President Richard M. Nixon’s resignation over the Watergate break-in.

Thomas “TJ” Carella is joining private equity firm Warburg Pincus after leading healthcare investments for Goldman Sachs, Fortune has learned.

At Warburg Pincus, Carella is expected to work with fellow Goldman Sachs gs veteran In Seon Hwang, who leads the firm’s healthcare and consumer groups.

Carella originally joined the merchant banking group of Goldman Sachs GS in 1997 as an analyst, before leaving to co-found an Italian software services business and to get his MBA from Harvard Business School. He rejoined Goldman Sachs in 2004, was named a managing director in 2009, and a partner in 2014. Most recently Carella has served as global head of healthcare for Goldman’s merchant banking group, and has served on the boards of such Goldman portfolio companies as T2Biosystems, Drayer Physical Therapy Institute, iHealth Technologies, and KAR Auction Services KAR .

A Warburg Pincus spokesman declined to comment.

Dave Johnson has stepped down as a senior managing director with The Blackstone Group BX , Fortune has learned from multiple sources.

He had joined Blackstone to lead tech investing in early 2013 from Dell, where he had spent the prior four years as senior VP of strategy. Soon after he tried leading a buyout of Dell on Blackstone’s behalf, but the firm never ultimately submitted an offer (Dell instead went private with the help of Silver Lake Partners, and more recently agreed to acquire EMC).

Prior to Dell, Johnson spent 27 years with IBM IBM , including as VP of corporate development and M&A.

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Johnson is expected to remain as an unofficial advisor to Blackstone, with plans to make smaller technology investments on his own. It is unclear if such deals would be done with personal money, or if Johnson is hoping to raise a fund. He is no longer listed on the Blackstone website.

A Blackstone spokeswoman declined comment. Fortune reached out to Johnson via email, but did not receive a reply.

In other Blackstone news, operating partner Sandy Ogg has quietly left after a five-year run. He previously had been chief HR officer for Unilver ADR and, before that, was a senior VP with Motorola.

Specialty grocery retailer Fresh Market said on Monday it agreed to be acquired by private equity firm Apollo Global Management for about $1.36 billion in cash.

The $28.50 per share offer represents a premium of 24% to Fresh Market’s Friday close.

The offer is at a 53% premium to Feb. 10, the day before Reuters reported that Apollo Global was among buyout firms participating in an auction process for Fresh Market.

Fresh Market said on Monday its board had unanimously approved the deal, except chairman and founder Ray Berry.

Berry recused himself from all discussions related to a review of strategic alternatives and from voting on the transaction, the retailer said.

Reuters had earlier reported, citing sources, that Berry was himself considering taking the company private.

Berry and his son Brett collectively own about 9.8% of Fresh Market’s outstanding shares.

The deal that has fully committed financing in place is expected to close in the second quarter of 2016.

Fresh Market has 183 stores, which it operates across 27 states. Its predominately southeastern locations include North Carolina, Florida, and Georgia. Its Mid-Atlantic and Midwest locations include Connecticut, New York, Kansas, Illinois, and Oklahoma.

Last year, Fresh Market hired Rick Anicetti as chief executive to help battle low margins and declining same-store sales. He had previously served for eight years as President and CEO of Food Lion LLC's grocery stores.

The deal underscores Apollo's confidence that it can turn around companies in the highly competitive U.S. grocery sector. The New York-based buyout firm's past investments include Sprouts Farmers Market and Smart & Final Stores.

J.P. Morgan Securities is financial adviser to Fresh Market, while Barclays, RBC Capital Markets, Jefferies and Macquarie Capital are advising Apollo.

A telltale sign of a merger mania: A raft of investment firms jump into the M&A market and start outbidding acquirers that are buying companies in their own businesses.

On Monday, the signs of M&A mania seemed obvious. A group led by China's Anbang Insurance Group has made a $76 a share, or roughly $13 billion, bid for Starwood Hotels hot , which had already agreed to be acquired by Marriott International mar . Apollo Management has made a $1.7 billion offer for Fresh Market tfm , the grocery store company, which Kroger had been rumored to be considering buying.

Anecdotally, there are certainly cases where private equity and other financial firms have got into bidding wars and the deals have turned sour. Just one example: Back in 2007, private equity firm Bain got into an ugly bidding war with other private equity firms before purchasing Clear Channel, which has since changed its name to iHeartmedia. That deal has been a disaster. Last week, lenders said iHeartmedia had defaulted on more than 25% of its debt.

But research shows that isn't typically the case. In fact, private equity managers have proven themselves to be pretty formidable acquisition competitors--so good, in fact, that Marriott and Kroger may consider higher bids for Starwood and Fresh Market, respectively. Over the last 27 years, 23% of all competing bids were made by financial sponsors, according to research from Amy Dittmar at the University of Michigan. But the percentage of financial bidders peaked during other merger market tops--1988 and 2006, when they comprised 42% and 36% of all competing bids respectively, according to the research.

Intuitively, it seems like a recipe for disaster. If Marriott were to buy Starwood, the combination could take advantage of all the synergies the two can create: cutting back office jobs that overlap at the two firms, for example. Private equity and other financial firms don't have these advantages. But while financial firms may not benefit from synergies, they also don’t have to take on all the costs and messy business of integrating two companies, either. That gives them more time to focus on either improving or closing underperforming divisions.

"Managers of less well-performing subsidiaries... have an incentive to lobby parents to secure additional resources to protect their unit, costly activities...that harm parent value," according to a study from researchers at HEC Paris. "After acquiring control, private equity can eliminate these costs, implement restructuring plans, and enforce managerial discipline." These restructuring capabilities are "a salient factor in the auction."

Second, private equity buyers often use more debt, which helps inflate potential returns, especially when interests are low and debt is cheap, as it is now. Marc Martos-Vila of the London School of Economics who has written a Harvard Business School paper on the subject says, "Our theory predicts that PE firms will tend to dominate strategic buyers during times when debt markets are overvalued.”

Still another report shows that private equity firms are actually the pros when it comes to hunting assets. In the study called "Follow The Leader: Acquiring Targets Picked by Private Equity,” University of Michigan's Dittmar says that private equity firms, by definition, have to be more selective about their targets.

"While corporate buyers may share operational synergies with the target firm, financial buyers rely primarily on improving the stand-alone value of the target firm or buying undervalued assets." In short, they're finding the good ones. And even in cases when the financial bidder ends up losing out on a deal, the combinations tend to work out better. She says deals earn about 12% better returns in the six months following announcement of a transaction if the acquiring firm out bid a financial acquirer rather than a rival or strategic bidder.

What does this mean for shareholders in companies like Starwood and Fresh Market? If the studies are right, buyout firms trying to go over the top and break up deals, will only spur more bidding and more contested M&A battles. That means the bubble, if it is, in the merger market will continue to grow.

The British enterprise software company Micro Focus mcfuf is buying San Mateo, California-based Serena Software, it said Tuesday.

Serena Software specializes in so-called application lifecycle management (ALM) software, which — as the name suggests — is used to manage the creation, deployment and eventual end-of-life of the software applications used in businesses.

The companies are pitching their new blend as having a big focus on “devops,” the trend in which software development and operational teams work closely with one another in order to update the software more frequently.

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“Our complementary strengths in software development and IT Operations will only serve to provide a stronger foundation for the next-generation of applications and services they require to meet ongoing business demands,” Serena CEO Greg Hughes said in a statement.

The deal, which is set to close in May, is worth $540 million.

Private equity firm HGGC bought Serena from Silver Lake Partners back in 2014. The terms for that deal were not disclosed, but it was reported to be worth $450 million. When Silver Lake bought Serena in 2006, it paid $1.2 billion.