Carlyle Group Co-Founder: "Greed Has Taken Over"

It would be a fool's game to predict the end of the private-equity buying frenzy, but certainly some signals are there.

Over much of the past two years, the prevailing private-equity mantra has been to buy as many companies as possible and then sell as much debt as possible to help pay for them. Now, the biggest private-equity firms are beginning to diverge in their views.

Henry Kravis, the co-founder of Kohlberg Kravis Roberts & Co., recently has described current conditions as a golden age for private equity. But Ripplewood Holdings LLC Chief Executive Timothy Collins, at a conference in Tokyo earlier this month, called current conditions a bubble that would end badly.

Carlyle Group co-founder David Rubenstein at the same conference also was bearishly looking ahead. "There hasn't been a failure for five years. We need to prepare people for the reality that some deals will fail," he said. He added: "Greed has taken over. Nobody fears failure."

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