A lot of America's newspaper companies have been in trouble. Advertising has been down as much as 15% this year and that has gotten worse in the last few months.

Almost all of the chains have had to cut staff and some properties have been put on the block to help the companies pay down debt. But, none of the really big operators in the business have had to go bankrupt.

That may change this week. The Tribune Company, which went private about a year ago, may not be able to make its debt service payments. According to The Wall Street Journal, "Tribune's latest actions underscore the deepening distress enveloping Tribune and other newspaper publishers."

The headline about the Tribune's trouble may be about the newspaper industry, but the story is just as much about the private equity/LBO trend that hit record levels less than two years ago. The Tribune Company was able to borrow almost $12 billion in an industry which was already beginning its downturn. That says a remarkable amount about the level of risk that bankers were willing to take to get fees.

Now, the firms that put the debt into the Tribune transaction are faced with getting pennies on the dollar. Newspapers may be a bad business, but it looks like private equity is turning out to be even worse.

Douglas A. McIntyre is an editor at 247wallst.com