This is not to say that the industry has fallen flat on itself this year, it has simply come to more reasonable levels of activity, compared to years prior. We saw the prices paid for firms in buyout deals rise significantly last year. Josh Lerner of the Harvard Business School noted that EBITDA multiples were, on average, 8.3 times earnings before interest, taxes, and depreciation/amortization, however, this was in an environment where returns generated by firms were 25% on average and as much as 40% in the upper stratospheres. Over the next year, returns are expected to come down from their 25% average to around 14%; still respectable outperformance, but not at the leverage-induced performance of last year. However, the private equity industry is not experiencing the same hang-over as some of the banks that are forced to write-down significant portions of their balance sheets, but the effect of the tightened credit market is sobering, causing many to point to happier times when billion-dollar buyouts will once again spread the elixer of good fortune.