Is there any end...

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Egaladeist
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Is there any end...

Post: # 123950Post Egaladeist
Tue Dec 09, 2008 12:24 am

Tribune Co has filed for Chapter 11 bankruptcy protection after struggling under a heavy debt load, according to a court document filed with the U.S. bankruptcy court in Delaware on Monday.

The privately held publisher of the Chicago Tribune and Los Angeles Times, which took on about $13 billion of debt when it went private last year under a deal led by real estate mogul Sam Zell, said in the filing that it had $7.6 billion in assets and $12.97 billion in debt as of December 8.

http://www.reuters.com/article/newsOne/ ... A620081208



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Re: Is there any end...

Post: # 123955Post Vorlin
Tue Dec 09, 2008 6:31 am

You're not going to see an end to this anytime soon, Eg... To have 7 billion in assets but 12 in debt, that makes me wonder who was doing what with the money. Then again, it's the same thing as the Big 3 asking for not 25 billion, but 34 billion!!! And not only is it being paid out by us, the taxpayers, but the layoffs that'll occur and the closings of countless stores nationwide to boot, we're still suffering for it and will for quite some time. Those three executives saying they'll cut their salary to $1 if they get their funding? Yeah, that's not meaning anything...how much do they have in stock options and such? I want to see them work for minimum wage in the back of a hot fast food restaurant because they have *nothing* else to rely on.
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Re: Is there any end...

Post: # 123957Post Aspman
Tue Dec 09, 2008 11:14 am

It's just the beginning.

The US/UK/EU high street demand has dropped. The impact of that has hit it's first vitims, the motor industry. The big three in the US are choking, their UK subsidiaries are also starting to squeal and UK/EU/Jap car companies are going the same way.

But thing have not been good for the car industry for a year or two, the high oil price was starting to slow things and the memory of that hasn't faded. Tax policy in UK/EU is killing trade in everything but small cars which carry little profit. The manufacturers are several years behind ('tis the nature of the beast, you can't tool up for a new model in 3 months) and are making sports cars when we want bicycles.

What is yet to happen is the highstreet downturn to hit China. It's got to happen. I think the first 2Q of next year will see it hit when the orders for new goods post Xmas just don't arrive.

Opec will drop production soon and I can see it happening again next year. Some have predicted oil at $25 but I think Opec will do everything it can to stop that. They see $70 as a sustainable price.
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Re: Is there any end...

Post: # 123960Post Egaladeist
Tue Dec 09, 2008 1:36 pm

Funny how a lot of long-established businesses are screaming massive debt-loads, closing stores, and threatening bankruptcy, or actually filing Chapter 7 or 11.

Look at Circuit City...155 store closures and Chapter 11...as just another example

http://www.pcmag.com/article2/0,2817,2334366,00.asp

by this time next year, along with the 700 billion bank debt, the US ' alone ' could be looking at a Trillion dollars of debt loss and debt recovery...not even including job losses and the loss of tax revenue from job losses.

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Re: Is there any end...

Post: # 123963Post Morganlefay
Tue Dec 09, 2008 3:35 pm

Yeah and funny how their execs still want bonuses too

Corporate greed at its finest!

Let them rot

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Re: Is there any end...

Post: # 123964Post Dogbert
Tue Dec 09, 2008 5:01 pm

If all of the car companies are hurting then why are the Asian companies making money?

It's the big three, well ok two of the big three (GM and Chrysler) that are really hurting. Ford can possibly survive this without bankruptcy.

I see GM and Chevy going to dust and Ford being the only US maker, competing with the Asian manufacturers based in the largely non-union southern US. If things worsen, which I'm sure they will, then the unions will be dead for a long time. Especially if the companies go into bankruptcy. Which would make the union contracts null and void.
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Re: Is there any end...

Post: # 123969Post Aspman
Tue Dec 09, 2008 8:58 pm

Japanese car companies are doing better than the big american 3 but not good.

They are all cutting production.

Not so sure about the Koreans.
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Re: Is there any end...

Post: # 123982Post Egaladeist
Wed Dec 10, 2008 3:05 pm

AIG gets a $150 billion U.S. government rescue package...then...still...wastes another $10 billion on bad trades

http://www.reuters.com/article/newsOne/ ... 1320081210

Australia

Global miner Rio Tinto , saddled with nearly $40 billion in net debt, said it would cut 13 percent of its workforce, slash capital spending by more than half and sell more assets as it battles a collapse in commodity prices.

http://www.reuters.com/article/newsOne/ ... 7520081210

and I get phone calls and disconnection notices from Ma Bell every time I'm more than one month behind. :roll: Funny how that works...if you were a small independent manufacturer on the verge of collapse the government would let you rot...but if you owe billions of dollars you can go to the government on a private jet with cup-in-hand and they're more than willing to help you out by paying off your billions.

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Re: Is there any end...

Post: # 123984Post Aspman
Wed Dec 10, 2008 4:28 pm

Unemployment benefit for 3 million workers is a lot of money.

And they are all voters.

Come voting time they'd remember the gov let them go to wall not that their loss was for the greater good.

Never underestimate the power spectre of votes has on politicians to f^ck us all long term so they can cling to office for the short term..
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Re: Is there any end...

Post: # 123987Post Egaladeist
Wed Dec 10, 2008 7:59 pm

You know..the governments will do what they always do...new administrations, instead of just fixing the problem, will spend their term just blaming the last administration for the problem.

And nothing gets fixed...and history repeats itself.

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Re: Is there any end...

Post: # 123994Post keezel
Wed Dec 10, 2008 11:01 pm

Egaladeist wrote:Look at Circuit City...155 store closures and Chapter 11...as just another example

http://www.pcmag.com/article2/0,2817,2334366,00.asp.
I don't know much about the other companies, but I worked for this one for about nine months. There is a reason they are failing, and it has nothing to do with bad economic times. Two of the few places in which sales have risen are in alcohol and entertainment. Circuit City fits into the latter category.

About a year and a half ago, CC decided to lay off all of their highest paid sales people and technicians. They made no distinction between seasoned veterans or work ethic - just laid people off based on pay. They very effectively managed to shoot themselves in the foot. Now - think about where all of those higher paid, veteran sales people went? They took their skills to CC's biggest competitor, Best Buy.

Poor management led to CC's demise - not bad economic times. CC management SUCKS, for a variety of reasons. The one I just wrote about happens to be the biggest and most widely published mistake they made.

Fortunately, I have since moved out of retail and I have what I consider to be a pretty decent job now. :)
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Re: Is there any end...

Post: # 123996Post rapier57
Wed Dec 10, 2008 11:17 pm

Circuit City probably deserves to go down. Office Depot announced closings, as have a few other stores. I think the more creative and nimble businesses will survive. The badly managed and run ones will go away. After the recovery, we'll have badly managed and run businesses again. They are the fodder for this kind of thing.

Ford looks to be able to survive this, as EG said earlier, with a credit arrangement made about a year ago. Saw that Toyota will cut production in the US.

There will be more large crashes to come, I'm sure. We are far from out of the woods on this.

Now, I can remember when the DJIA broke 1,000. I was in Vietnam at the time, hoping my ship wouldn't get hit by counter battery fire. Not that I want to go back there, just threw that in for a little perspective.
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Re: Is there any end...

Post: # 124000Post Aspman
Thu Dec 11, 2008 10:09 am

We've just lost Woolworths which I think started in the USA about 100yr ago. they're looking at 25000 job losses.

But again they had a poor business model and have had problems for years. Recessions do weed out the poor performers.
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Re: Is there any end...

Post: # 124016Post Harbinger
Thu Dec 11, 2008 8:51 pm

This is what happens when you run your economy on money owned by someone else that doesn't technically exist. Making the bailouts to the banks was ludicrous, and bailing out the car manufacturers is (almost unphathomably) even more so. Let's say that this hand-out does manage to keep them alive for a bit longer. People still won't be buying their cars. They will still fail. What then....more bailout?

I haven't even been able to acknowledge what has been going on for the past two months because I am so overwhelmingly disgusted at how those with the worst possible grasp for economics are the ones making all of the idiotic, redundant, obviously worst choices imaginable.
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Re: Is there any end...

Post: # 124018Post Egaladeist
Thu Dec 11, 2008 9:08 pm

I think we are seeing the beginning of a collapse of an Empire...for decades everyone gauged the value of their economy and money by the US standard/dollar...

for decades the vast majority of debt ( US, Canada ) was owed internally... when I was a kid I think something around 80% of all Canadian Debt was Canadians owing Canadians ( T-Bills, Canada Savings Bonds , etc... ) ...

the more foreign debt you owe the less stable your economy ....the vast majority of Countries that have valueless currency are Countries with massive foreign debt...

internal debt can be managed and circulated...foreign debt is just money you owe out...

if the US keeps borrowing money from places like China, increasing their foreign debt load, we may very well see the day, in our lifetime, that the US dollar currency has as much value as the peso.

I'm not an economist so I may be wrong, but that is my understanding of how it works.

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