The next hit to the economy could come from the debt used by private equity to buy ownership in companies. With cheap debt readily available from the banks, many large private equity firms used leverage as their main tool in their box to grow companies. What this meant was that private equity would put in 20% and use up to 80% of bank debt to build a massive war chest to grow a company's market share by acquisitions, not organic growth.
Do remember that the smaller funds were more into rolling up their sleeves and doing the sweat equity of sales and marketing to find customers and make them very happy, earning revenue and loyalty. Here is the rest of the story about the leverage kings of private equity:
The debt piled on companies amid the decade's $1 trillion buyout boom is coming due. The only question is about the extent of the fallout. The day of reckoning could simply be disruptive for the parties involved, or it could bring down the whole economy in much the same way bad mortgages broke confidence in the credit markets, effectively grinding them to a halt. Witness Hilton Worldwide, a portfolio company of Blackstone Group LP. Like almost every private-equity buyout, Blackstone acquired Hilton by putting down about 20% of the deal price. The rest was financed by borrowing, except Blackstone didn't assume the debt, Hilton did. Now Blackstone is in talks with Hilton's creditors to cut $5 billion from the $20 billion debt load carried by hotel and resort chain. Blackstone may pay down some of the debt at a discount in return for taking a bigger equity stake. (See WSJ story on Hilton.)