I think the best plan then is to pay cash, and carry out the goods. That way if the company goes under, it won't be me that's swindled. m We are emerging from several rounds of tax cuts to the largest corporations, and what has been the result? Did they use the largesse of the government to create jobs? What they did do was to race around, taking each other over, so as to reduce competition, then they laid off much of their staff, and reduced the wages and benefit packages to the rest. Then they acquired more companies, and laid off more people. Then they transferred their manufacturing interests to off shore ports of convenience. Now they are telling us that they know that they have done wrong, and they need several trillion dollars for the loan sharks, to right the situation. And the government has gone along with them. I would hope that any bank that benefits from such a program, be subjected to proportionally the same kind of scorn that is aimed at the single mother, with six kids by six fathers, and who wants more welfare benefits.
On Oct 2, 2:57 am, Frank <[EMAIL PROTECTED]> wrote: > All very well and good, except that it doesn't address the cause of > the credit crunch. The banks won't lend to each other because they > don't have enough cash to cover the bad debts they are holding on > their own books. Wachovia for example assets were just over half of it > outstanding loans. They are also frightened to lend money to each > other as no-one knows the exent of which other organizations are > exposed to sub-prime loans. > > Mr. Reinach is a financial jackass who has no experience in running a > multinational corporations. > > Cash-Starved Companies Scrap Dividends, Tap Credit (Update2) > By Kelly Riddell > > Oct. 1 (Bloomberg) -- Carmike Cinemas Inc., the third- largest U.S. > theater chain by screens, suspended its dividend, while Duke Energy > Corp., owner of utilities in five U.S. states, tapped $1 billion from > a credit agreement and RC2 Corp., the maker of infant and preschool > products, canceled an acquisition. > > The paralysis in credit markets is changing how U.S. companies do > business as banks pull back on loans or make them prohibitively > expensive. Some companies are closing plants and stores, postponing > takeovers and grabbing any available credit in a fight for survival. > > ``If businesses don't have access to capital, smaller companies in > particular, they might get wiped out,'' said Alec Young, a New York- > based equity strategist at Standard & Poor's. ``It's impossible to > quantify how expensive this crisis is going to be for Corporate > America; there's unlimited downside.'' > > Ford Motor Co., the second-largest U.S. automaker, said it repaid $1.5 > billion in debt that was due today, without giving details. Analysts > said yesterday they expected Ford to make the payment in cash and not > tap an $11.5 billion revolving credit line. Slumping auto sales and > surging borrowing costs may boost U.S. new-vehicle dealership closures > as much as 40 percent this year, the National Automobile Dealers > Association said yesterday. > > Deal Scrapped > > Circuit City Stores Inc. and memory-chipmaker Spansion Inc. face > higher interest expenses and slowing sales, analysts said. In the last > week, Angiotech Pharmaceuticals Inc. scrapped a financing deal and > newspaper publisher McClatchy Co. said it renegotiated credit lines. > > Banks more than doubled the interest rate they charge each other for > borrowing dollars overnight, known as the London interbank offered > rate, to a record 6.88 percent yesterday, the British Bankers' > Association said. Adding to the financial stress was the U.S. House of > Representatives' rejection of a $700 billion bank-rescue plan Sept. 29 > and the bankruptcy of Lehman Brothers Holdings Inc. on Sept. 15. > > ``It's almost inconceivable that there won't be an enormous slowdown > in the U.S. markets and with that, increased joblessness, lower > employment and higher bankruptcy rates, both personal and corporate,'' > Michael Vogelzang, who oversees $2 billion as chief investment officer > at Boston Advisors LLC, said in an interview yesterday. ``Businesses > are going to have to adapt.'' > > GE, Buffett > > Early today, General Electric Co., the second-largest U.S. company, > said it's been able to sell corporate paper and fund operations > without tapping bank lines. After the stock fell as much as 9.8 > percent, GE announced plans to sell $12 billion in common shares and > said billionaire investor Warren Buffett's Berkshire Hathaway Inc. > will buy $3 billion in preferred shares. > > ``It enhances our flexibility and allows us to execute on our > liquidity plan,'' CEO Jeff Immelt said in a statement. ``In addition, > we remain committed to the Triple A rating and in the recent market > volatility, we continue to successfully meet our commercial paper > needs.'' > > Carmike Cinemas halted its dividend payment and spent $10 million to > pay bank debt, the Columbus, Georgia-based company said in a statement > yesterday. Over the past four quarters, Carmike said it made $9 > million in dividend payments. It has $285 million in bank debt, down > from $302 million on Dec. 31. > > Credit Agreement > > Duke has $650 million in bonds coming due this year, $442 million > scheduled to mature next year and $500 million in 2010, according to > data compiled by Bloomberg. Chief Financial Officer David Hauser said > Duke is drawing from its credit agreement because it wasn't clear > whether it would be able to secure more than $1 billion in new > financing this year as planned. > > RC2, the maker of Learning Curve products, sank the most in more than > a year in Nasdaq trading yesterday after canceling its acquisition of > Publications International Ltd.'s children's publishing unit, citing > difficulty obtaining financing. Citation Corp., a closely held auto- > parts maker, said it postponed an acquisition planned for earlier this > year due to the tightening credit markets. > > ``People are concerned with pending acquisitions especially if they > are going to be financed via the debt markets or via bank-syndicated > credit lines,'' Timothy Conder, a St. Louis- based analyst with > Wachovia Securities Inc., said in an interview yesterday. > > `Unraveled a Week Later' > > ``Things you thought you had done last week get unraveled a week > later,'' Citation Chief Executive Officer Douglas Grimm said in a > telephone interview yesterday. ``The difficulty in the credit markets > and your ability to negotiate with the banks is affecting everyone.'' > > Vancouver-based Angiotech said last week that it wouldn't be able to > meet the terms of a financing deal with Ares Management LLC of Los > Angeles and New York-based venture capital firm Leaf Venture Partners, > citing lowered revenue expectations and cash shortages. The developer > of drug-coated medical devices said it plans to cut jobs, close a U.S. > plant and delay a new product. > > Sacramento, California-based McClatchy, the publisher of the Miami > Herald, announced Sept. 26 it negotiated an amendment with banks on > its $1.18 billion credit line, agreeing to higher interest rates and > borrowing limits in exchange for more lenient terms on cash flow. > Today, Gannett Co., the largest U.S. newspaper publisher, accessed a > revolving credit line to ensure it has funds to repay commercial paper > in response to credit- market disruption. > > Circuit City > > Circuit City, the second-largest U.S. consumer-electronics company, > hired turnaround firm FTI Consulting Inc. as an adviser, according to > two people familiar with the appointment. The interest rate on Circuit > City's long-term debt is tied to Libor, which may increase the > company's quarterly interest payment by at least $2 million, according > to Bloomberg data. > > Circuit City said in a statement Sept. 29 that it had suspended plans > for store openings for fiscal 2010, beyond commitments already made, > and may close unprofitable locations. The chain has more than 1,480 > stores. > > ``The risks of bankruptcy are very real,'' for Circuit City, David > Schick, a Baltimore-based analyst with Stifel Nicolaus & Co., wrote in > a Sept. 29 research note. ``Vendors will have to decide how they plan > to do business at Circuit City.'' He recommends investors hold the > shares. > > Circuit City has a secure line of credit through Bank of America Corp. > that is backed by assets including inventory, spokesman Bill Cimino > said in an interview yesterday. > > Suppliers `Sticking With Us' > > ``We feel we have adequate liquidity to fuel our turnaround, providing > our vendors can support us,'' Cimino said. ``Even though the capital > markets are making things more difficult for them, our vendors are > sticking with us.'' > > Spansion, the memory-chipmaker that hasn't reported a profit since it > was spun off from Advanced Micro Devices Inc. in 2005, may need to > raise capital to stay in business, according to Cowen & Co. LLC > analyst Daniel Berenbaum. > > Spansion's interest-coverage ratio, or earnings divided by interest > expense, was negative 2.44 at the end of the second quarter. The lower > the ratio, the less the company may have available to make interest > payments. > > Spansion had $240 million cash at the end of the second quarter, down > 28 percent from three months earlier. It has $2.4 billion in > liabilities, according to Bloomberg data. Spokeswoman Holly Burkhart > declined to comment. > > To contact the reporter on this story: Kelly Riddell in Washington at > [EMAIL PROTECTED] > > Last Updated: October 1, 2008 15:57 EDT > > Microsoft, Schering-Plough See `Entire Economy' in Jeopardy > By Dina Bass and Shannon Pettypiece > > Sept. 30 (Bloomberg) -- Officials from Microsoft Corp. to Office Depot > Inc. and Schering-Plough Corp. said the government's failure to bail > out the U.S. banking industry put the ``entire economy'' at risk > unless a deal comes soon. > > ``The various sectors of the economy are so intricately linked, we > need to recognize that the entire economy turns on what happens > here,'' Microsoft General Counsel Brad Smith said in an interview > after the House of Representatives voted 228 to 205 yesterday against > giving Treasury Secretary Henry Paulson the authority to buy troubled > assets from financial companies. > > Executives from across corporate America echoed the remarks, the first > time Microsoft says it has weighed in on financial legislation. They > called on lawmakers to put aside partisan differences and work to > restore credit supplies and confidence to the financial markets. The > Standard & Poor's 500 Index tumbled the most since 1987 yesterday and > the Dow Jones Industrial Average slid 778 points, the most points > ever. > > The liquidity crisis has spread beyond Wall Street, threatening > earnings at businesses from retailers to technology companies. The > Treasury's toolkit to protect the financial system is ``substantial > but insufficient'' after the $700 billion bailout failed to pass, > Paulson said yesterday. > > ``It is a pity that this has developed into such a mess,'' said Fred > Hassan, chief executive officer of drugmaker Schering- ... > > read more » --~--~---------~--~----~------------~-------~--~----~ Thanks for being part of "PoliticalForum" at Google Groups. 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