Sokes
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Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 12:55 pm

I believe that this deserves an own topic. The topic is about advantages/ disadvantages of a hypothetical bankruptcy. To discuss the probability of Boeing going bankrupt or financial data please post in "Boeing financial discussion 2020"

Boeing is still worth 70 billion $ or so. They have negative equity (more liabilities than assets) of 8,3 billion $. If one doesn’t accept their deferred production cost as an asset the situation is even worse. But then there are depreciated buildings which show with one Dollar in the book, which improves the situation.
Boeing can issue new shares. They shouldn’t have a problem to get 30 billion $ new equity for 50% of the company. With so much new equity banks will give an extra 40-60 billion $ credit. There is absolutely no need for government help. But for the sake of discussion let’s assume Boeing goes bankrupt.

People hate change. Nearly all workers at Boeing fear for their job, most of them probably demand help from the government. But is government intervention in the interest of American labor, even of workers at Boeing?

Boeing workers:
Assuming Boeing goes bankrupt. Would Seattle be the next Detroit?
Bombardier’s C-Series was taken over by Airbus. Is this bad or good for Bombardier workers?
Suppose the government gives Boeing a credit. What will be Boeing’s business policies in future if the board remains the same? I remember when banks had to be saved politicians promised to introduce strict rules. Did it happen? Did banks repent?
Suppose Boeing gets a new owner. Boeing would get an equity infusion. What’s better for the Boeing employees, equity or government credit? Would the new owner also focus on share buybacks, knowing the government won’t help him? Is the chance of increased spending on research and development better under the old board with government credit or under a new owner with equity infusion?
So why are Boeing employees keen that their management, which caused all the problems, be rescued by government help?

US labor:
Is it in the interest of employees of suppliers that Boeing carries on as before with even more debt?

On a more general discussion:
“The manifestation of the “shareholders first” philosophy is very negative for a long-cycle industry like aerospace, which faces enormous challenges—including sustainable development—that will require large sums of R&D. Boeing, for example, spent an average of $12.8 billion in share buybacks and dividends in 2018 and 2019, while averaging just $2.2 billion in R&D. This is not just a Boeing problem; it is a corporate America problem. In 2018, share buybacks and dividends for the S&P 500 were an astounding 109% of net income, according to The Wall Street Journal. This disparity points to another issue: Companies are taking on debt to fund shareholder generosity. This is not sustainable in the long run and leaves no capital to invest in customers, suppliers, employees or local communities. “
https://aviationweek.com/aerospace/manu ... ders-first

Should corporate America get a signal to carry on, the government is there to help?
I believe a bankruptcy of Boeing would be a wake up call. My main hope is that it would lead to changes in regulation. Or better: To reintroduce the regulations which worked well for many decades.


On a more philosophical level:
Indian politicians have rather less respect for the rule of law. Government enacts a law which entitles people to a subsidy. Everybody entitled can apply, but the administration decides who gets that subsidy and who doesn’t. It’s arbitrary. People who voice opposition won’t get the subsidy. As a result the 30% or so of thinking population don’t voice their opinion and with the 70% deciding elections, the politicians can do what they want.

It doesn’t stop here. An old government gave coal fields to business friends. Needless to say these friends give donations to the people who did them the favor. Arbitrary decisions can ruin a country if politicians can expect to get favors in return. I believe it's better to err on the side of safety.
Depending on where in India people who invest money in a business may later get refused a "no objection certificate" by a government department. One can always approach a court, but that’s quite a timepass.
People who never lived in a country that doesn’t have strict rule of law don’t know what a blessing it is. And I’m one of the few Germans who will cross a red traffic light if there is no traffic. I have no power, so it doesn’t matter. But people in power must apply rules equal to everybody, including bankruptcy.


“Liberalism (in the European nineteenth century meaning of the word...) is concerned mainly with limiting the coercive power of all government, whether democratic or not, whereas the dogmatic democrat knows only one limit to government – current majority opinion.
The difference between the two ideals stands out most clearly if we name their opposites:
For democracy it is authoritarian government;
For liberalism it is totalitarianism.
Neither of the two systems necessarily excludes the opposite of the other: a democracy may well wield totalitarian powers, and it is conceivable that authoritarian government may act on liberal principles.
...
The democratic and the liberal traditions thus agree that whenever state action is required, and particularly whenever coercive rules have to be laid down, the decision ought to be made by the majority. They differ, however, on the scope of state action that is to be guided by democratic decision. While the dogmatic democrat regards it as desirable that as many issues as possible be decided by majority vote, the liberal believes that there are definite limits to the range of questions which should be thus decided ... the liberal regards it as important that the powers of any temporary majority be limited by long term principles.
To him it is not from a mere act of will of the momentary majority, but from a wider agreement on common principles that a majority decision derives its authority.
The crucial conception of the doctrinaire democrat is that of popular sovereignty. This means to him that majority rule is unlimited and unlimitable. The ideal of democracy, originally intended to limit all arbitrary power, thus becomes the justification for new arbitrary power.
...
Moreover majority decisions are peculiarly liable, if not guided by common principles, to produce over-all results that nobody wanted. It often happens that a majority is forced by its own decisions to further actions that were neither contemplated nor desired. ... The individual decision may have been intended only to deal with a particular situation. But it creates the expectation that whenever similar circumstances occur the government will take similar action.”
F.A. Hayek, “The Constitution of Liberty”, chapter “Majority Rule”, 1960
Why can't the world be a little bit more autistic?
 
MIflyer12
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 1:16 pm

Sokes wrote:
Should corporate America get a signal to carry on, the government is there to help?
I believe a bankruptcy of Boeing would be a wake up call. My main hope is that it would lead to changes in regulation. Or better: To reintroduce the regulations which worked well for many decades.


What regulations do you want to re-introduce that are relevant to Boeing and the American working class?

Do you understand that most American business bankruptcies don't involve government money?
 
IADCA
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 1:22 pm

This can't be a serious question. For all Boeing's faults, it still supports a huge number of steady, relatively well-paid blue-collar jobs. There is no way its bankruptcy would ever be a positive for the working class. Even if the company rose from the ashes, it would be as a right-to-work-state shambles in terms of jobs, basically the Charleston plant replicated, or with much worse worker terms in the Puget Sound area.
 
Weatherwatcher1
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 1:28 pm

Airbus lost more money in 2019 than Boeing did. Boeing has a healthy defense business. The market for drones, satellites, missiles, helicopters, etc isn’t going away and compensating for losses in he commercial division. Have you heard of economy of scope?

Boeing’s expertise spans a broad range of products in defense. Fighter jets, rotorcraft, embedded product support, cybersecurity products, surveillance suites, advanced weapons, missile defense and commercial aircraft derivatives all fit in Boeing’s portfolio. The company can leverage this holistic knowledge and deliver the value of those integrated systems to its customers.


https://www.boeing.com/defense/

THe worlds largest manufacturer of satellites is unlikely to go bankrupt
Last edited by Weatherwatcher1 on Wed Mar 18, 2020 1:29 pm, edited 1 time in total.
 
dtw2hyd
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 1:29 pm

Chapter 11 Section 363 restructuring is not a bad idea. Leave MAX, liabilities and 777X programs with Old Boeing Company and sell worthy assets to New Boeing Company.
 
Sokes
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 1:37 pm

MIflyer12 wrote:
Sokes wrote:
Should corporate America get a signal to carry on, the government is there to help?
I believe a bankruptcy of Boeing would be a wake up call. My main hope is that it would lead to changes in regulation. Or better: To reintroduce the regulations which worked well for many decades.


What regulations do you want to re-introduce that are relevant to Boeing and the American working class?

Do you understand that most American business bankruptcies don't involve government money?


"The SEC, operating under the Reagan Republicans, passed rule 10b-18, which made stock buybacks legal. Up until the passing of this rule, the Securities Exchange Act of 1934 considered large-scale share repurchases a form of stock manipulation."
https://finance.yahoo.com/news/7-reason ... 53787.html

1934 means it's a Roosevelt regulation.
To prohibit share repurchases is just one example. To reintroduce the Glass-Steagall Act of 1933 is another example which however does not refer to Boeing. This act separated commercial banking from investment banking.
In short: Let's go back to Roosevelt regulation. That worked well for many decades.

I do understand that most bankruptcies don't involve government money. My issue is with the word "most".
One can argue if airlines at the moment deserve help or not. But I believe they just have to issue new shares to cover their losses.
If the government wants to help they need to make a law applicable to all. Example: Every company gets three months wages paid by the government. How to justify that an airline deserves help, but a restaurant owner doesn't?
Why can't the world be a little bit more autistic?
 
Sokes
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 2:03 pm

IADCA wrote:
This can't be a serious question. For all Boeing's faults, it still supports a huge number of steady, relatively well-paid blue-collar jobs. There is no way its bankruptcy would ever be a positive for the working class. Even if the company rose from the ashes, it would be as a right-to-work-state shambles in terms of jobs, basically the Charleston plant replicated, or with much worse worker terms in the Puget Sound area.


Yes, it still supports. The question is for how long? Outsourcing for Dreamliner, reengine for Max. Do you believe the current Boeing board plus government money will secure jobs long term?
What about workers in other companies if a rescue by tax money raises expectations in managers of those other companies?

I agree you are 50% right.
At any rate no need to worry. If the government makes it clear that there won't be any help new shares would enter the market. If bought by one investor it may even change the board.
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SQ32
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 2:22 pm

It is definitely against the interest of USA to let Boeing go out of business. Boeing holds far too many technologies, far more than Intel, Microsoft, Google or Facebook, especially in the domain of system engineering.

It is more easy to rebuild a narrow band business such as Amazon. Her astronomical market cap may convey an wrong impression of her importance. USA may never able to rebuild yet another Boeing.
 
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 2:28 pm

SQ32 wrote:
It is definitely against the interest of USA to let Boeing go out of business. Boeing holds far too many technologies, far more than Intel, Microsoft, Google or Facebook, especially in the domain of system engineering.

It is more easy to rebuild a narrow band business such as Amazon. Her astronomical market cap may convey an wrong impression of her importance. USA may never able to rebuild yet another Boeing.


Going bankrupt doesn't equal going out of business. I don't think that anyone here is arguing for Boeing to go out of business.
 
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 2:31 pm

I fail to see how bankrupt companies are a benefit to anything.
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SQ32
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 2:33 pm

USA should nationalized Boeing, and pay her CEO 14 x (minimum salary of the company employee).

Boeing is a showcase 1% of USA are goons, thieves and selfish psychopath.
 
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 2:48 pm

Sokes wrote:
Nearly all workers at Boeing fear for their job, most of them probably demand help from the government.

Sokes wrote:
So why are Boeing employees keen that their management, which caused all the problems, be rescued by government help?


I'd really like to know where you're getting this from. Seriously...cite sources other than "everyone knows"...because I don't know where this is coming from.
"You haven't seen a tree until you've seen its shadow from the sky."
 
zakuivcustom
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 2:52 pm

Ch. 11 and restructuring? Why not at this point.

Boeing Commercial Airplane going out of business? Very unlikely given the duopoly.
Boeing as a whole going out of business? Not going to happen as Boeing Defense, Space & Security will always be around one way or another.
 
IADCA
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 3:58 pm

Sokes wrote:
IADCA wrote:
This can't be a serious question. For all Boeing's faults, it still supports a huge number of steady, relatively well-paid blue-collar jobs. There is no way its bankruptcy would ever be a positive for the working class. Even if the company rose from the ashes, it would be as a right-to-work-state shambles in terms of jobs, basically the Charleston plant replicated, or with much worse worker terms in the Puget Sound area.


Yes, it still supports. The question is for how long? Outsourcing for Dreamliner, reengine for Max. Do you believe the current Boeing board plus government money will secure jobs long term?
What about workers in other companies if a rescue by tax money raises expectations in managers of those other companies?

I agree you are 50% right.
At any rate no need to worry. If the government makes it clear that there won't be any help new shares would enter the market. If bought by one investor it may even change the board.


I think people in the US are well aware of which pet industries get bailouts and which ones the government lets to rot - the vast majority. Aviation and aerospace is firmly in the first column. There's not really any discussion to be had here. The board may well change but the board members will continue to be drawn from the same cesspool the current ones are, and so the management philosophy will not appreciably change. I appreciate that you put a lot of thought into the OP, however.
 
Sokes
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 4:08 pm

einsteinboricua wrote:
Sokes wrote:
Nearly all workers at Boeing fear for their job, most of them probably demand help from the government.

Sokes wrote:
So why are Boeing employees keen that their management, which caused all the problems, be rescued by government help?


I'd really like to know where you're getting this from. Seriously...cite sources other than "everyone knows"...because I don't know where this is coming from.


Point taken. These are just assumptions.
You disagree? I would be happy to hear if many Boeing workers have similar thoughts.
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 4:27 pm

Boeing has asked for $50 billion from the US Government to fund operations and the Government has agreed they should get it so bankruptcy is not likely for the time being.
 
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 4:27 pm

Sokes wrote:
You disagree? I would be happy to hear if many Boeing workers have similar thoughts.

I have first hand knowledge of employee sentiment at Boeing and I can guarantee you that, as far as I know, NONE of them are begging for the federal government to bail out the company.

Like they say: never assume; it makes an ASS of U and ME (mostly U in this case).
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Sokes
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 5:24 pm

einsteinboricua wrote:
I have first hand knowledge of employee sentiment at Boeing and I can guarantee you that, as far as I know, NONE of them are begging for the federal government to bail out the company.

Like they say: never assume; it makes an ASS of U and ME (mostly U in this case).


I was under the impression that at the threat of bankruptcy most employees of big companies demand a rescue. I am pleased to learn that I'm wrong. To throw in the next assumption: I guess in this industry there is too much brain to apply conventional rules.
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PPVRA
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 5:27 pm

Going back to useless regulation from Roosevelt nobody in this planet thinks is effective? I think not....
Last edited by PPVRA on Wed Mar 18, 2020 5:34 pm, edited 1 time in total.
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 5:29 pm

Sokes wrote:
I was under the impression that at the threat of bankruptcy most employees of big companies demand a rescue. I am pleased to learn that I'm wrong. To throw in the next assumption: I guess in this industry there is too much brain to apply conventional rules.

There's still no threat of bankruptcy. There's the sense that layoffs may come due to troubles caused by Max and this slump. But no one has yet sounded the alarm, concerned that the company will go bankrupt.

This video shows why Boeing will not be let go bankrupt (using Lockheed as an example).

There's more to Boeing than just commercial aviation.
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bhill
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Wed Mar 18, 2020 6:25 pm

No, ANY company that goes bankrupt is not good! Folks become unemployed, creditors get screwed for pennies on the dollar, it that. This is why the Fed had to step in in 2008 with the auto industry and others, because it causes a domino effect all the way to supply chain, etc.
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Thu Mar 19, 2020 12:08 am

Sokes wrote:
1934 means it's a Roosevelt regulation.

Which means it was largely constructed by Joseph P. Kennedy, JFK's dad. His biography is fascinating. I'll send a link if anyone is interested.

The short version is Joe was a bright child of a politically active immigrant family who made it through Harvard, which was a very rare thing for an Irish Catholic in those days. Since none of the WASP financial firms would hire him (because he Irish Catholic), he took a job with the state banking regulator, where he proceeded to learn in great detail every trick banks used to scam the system. Once he had that knowledge he started his own bank, and once he married Boston's mayor's daughter a lot of people willing to put their money into his bank, so he got rich. Purely on intuition alone he pulled all his investments out of the market right before the crash of 1929 so he remained rich while many others became poor. Since he didn't need to earn more money he decided to get into politics, mainly to be in a position to boost the political prospects of his son, Joe Jr (not John!). Since he knew banking, Roosevelt put him in charge of banking reform. Since he knew how all the banking scams operated, the new law he helped write was damned effective. Undoing many of its provisions IMO lead to the great crash of 2008.

Strange world, isn't it?

There's a lot more to the man's life (cheating on his wife with famous Hollywood actresses, having a lobotomy performed on one of his daughters because he got bad advise from the doctors of the day, having the prodigal son Joe get killed in WWII so JFK had to take over the political aspirations, JFK getting killed, etc) so his bio is pretty amazing reading.
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Thu Mar 19, 2020 8:46 am

Stitch wrote:
Boeing has asked for $50 billion from the US Government to fund operations and the Government has agreed they should get it so bankruptcy is not likely for the time being.


Would be interesting where that money is used for.
 
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Thu Mar 19, 2020 8:53 am

marcelh wrote:
Stitch wrote:
Boeing has asked for $50 billion from the US Government to fund operations and the Government has agreed they should get it so bankruptcy is not likely for the time being.


Would be interesting where that money is used for.


At least a little will be devoted to golden parachute prep :duck:
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Sokes
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Thu Mar 19, 2020 11:40 am

IADCA wrote:
I think people in the US are well aware of which pet industries get bailouts and which ones the government lets to rot - the vast majority.


To avoid arbitrary decisions I suggest following law:
Companies who pay regular tax don't get help, too big to fail companies who enjoy tax breaks get rescued.


Revelation wrote:
Sokes wrote:
1934 means it's a Roosevelt regulation.

Which means it was largely constructed by Joseph P. Kennedy, JFK's dad. ... Since he knew banking, Roosevelt put him in charge of banking reform. Since he knew how all the banking scams operated, the new law he helped write was damned effective. Undoing many of its provisions IMO lead to the great crash of 2008.


Reminds me of the movie "Catch me if you can"
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Thu Mar 19, 2020 11:55 am

Aaron747 wrote:
marcelh wrote:
Stitch wrote:
Boeing has asked for $50 billion from the US Government to fund operations and the Government has agreed they should get it so bankruptcy is not likely for the time being.


Would be interesting where that money is used for.


At least a little will be devoted to golden parachute prep :duck:


And some may be used to magically shrink some deferred costs from a certain program with a "plasic" plane..... :stirthepot:
 
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Thu Mar 19, 2020 1:07 pm

marcelh wrote:
Aaron747 wrote:
marcelh wrote:

Would be interesting where that money is used for.


At least a little will be devoted to golden parachute prep :duck:


And some may be used to magically shrink some deferred costs from a certain program with a "plasic" plane..... :stirthepot:


“A deferred cost is a cost that you have already incurred, but which will not be charged to expense until a later reporting period.“

https://www.accountingtools.com/article ... -cost.html

Increasing cash in Boeing’s account isn’t going to have any effect on their deferred expenses, unless it’s creating a new deferred expense.
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Thu Mar 19, 2020 10:54 pm

Stitch wrote:
Boeing has asked for $50 billion from the US Government to fund operations and the Government has agreed they should get it so bankruptcy is not likely for the time being.


Trump seemed far less supportive of “a company that spent so much money on stock buybacks” at today’s White House presser. He mentioned support specifically for airlines, the travel industry and others but didn’t mention Boeing by name despite being asked specifically about them in the question.
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Stitch
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Fri Mar 20, 2020 12:05 am

Stitch wrote:
Boeing has asked for $50 billion from the US Government to fund operations and the Government has agreed they should get it so bankruptcy is not likely for the time being.

scbriml wrote:
Trump seemed far less supportive of “a company that spent so much money on stock buybacks” at today’s White House presser. He mentioned support specifically for airlines, the travel industry and others but didn’t mention Boeing by name despite being asked specifically about them in the question.


And yet earlier in the week he mentioned them by name in terms of support. But then he operates from soundbite to soundbite / Tweet to Tweet so no surprise he reverses himself.

And the airlines are as guilty of massive stock buybacks as Boeing - American Airlines has used a significant majority of its recent profits to fund them and I expect the others are as guilty.

In the end, they will all get the money so...
 
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Fri Mar 20, 2020 2:31 am

Bankruptcies of large corporations always cause more damage to working class people than anyone.

Their are at least 150,000 people who work for Boeing. Figure 450,000 family members. And likely twice that number, maybe higher, who work for companies that supply products and raw material for Boeing.

There are approximately 565,000 shares outstanding as of the end of 2019, a 3.43% decline since the previous year. Today's activity was 40 million shares traded, a substantial percentage of the outstanding shares.

If the value of all those shares falls to ZERO due to bankruptcy, how many of those shares belong to small investor's, 401ks and such. GM's last bankruptcy destroyed hundreds of thousands of senior citizen's lives. Yes, they should have paid more attention. The few thousand I had in GM stock was speculation, and I lost that bet.

But to a lot of people, the bankruptcy meant moving to smaller, less safe apartment. Reduced food budgets, not traveling as often to see children and grandchildren.

And my personal opinion, is that the big money people who set the bad policies NEVER lose substantially. It is always the working class people who get shafted.
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Fri Mar 20, 2020 2:55 am

rfields5421 wrote:
Bankruptcies of large corporations always cause more damage to working class people than anyone.

Their are at least 150,000 people who work for Boeing. Figure 450,000 family members. And likely twice that number, maybe higher, who work for companies that supply products and raw material for Boeing.

There are approximately 565,000 shares outstanding as of the end of 2019, a 3.43% decline since the previous year. Today's activity was 40 million shares traded, a substantial percentage of the outstanding shares.

If the value of all those shares falls to ZERO due to bankruptcy, how many of those shares belong to small investor's, 401ks and such. GM's last bankruptcy destroyed hundreds of thousands of senior citizen's lives. Yes, they should have paid more attention. The few thousand I had in GM stock was speculation, and I lost that bet.

But to a lot of people, the bankruptcy meant moving to smaller, less safe apartment. Reduced food budgets, not traveling as often to see children and grandchildren.

And my personal opinion, is that the big money people who set the bad policies NEVER lose substantially. It is always the working class people who get shafted.


Could not agree more - ‘too big to fail’ as a concept is not about protecting the executive class - they never experience pain regardless. The Occupy WS kids had their heads in the sand on this. The term actually means ‘so big everyone and their mother will get screwed’. We cannot allow institutions plugged into everything to fail - too much downside risk.
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Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Fri Mar 20, 2020 4:01 am

It could knock the US into a recession if Boeing failed. And even compromise national security since Boeing is the 2nd biggest defense contractor in the world. Boeing is textbook "too big to fail".
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anrec80
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Joined: Mon Jan 10, 2011 7:50 am

Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Fri Mar 20, 2020 5:03 am

TWA772LR wrote:
It could knock the US into a recession if Boeing failed. And even compromise national security since Boeing is the 2nd biggest defense contractor in the world. Boeing is textbook "too big to fail".


Ditto. I don't think anyone will let this happen or will be just standing there and looking as Boeing, a major military contractor, employer with hundreds of thousands of middle class jobs, a major exporter just goes belly up. This is too critical of a company. Even Russia in 90s did whatever they could to support their aviation industry even though it was producing a few planes a year at max. They rather allocate $50Billion, and throw 50 billion more in military orders at them.
 
Sokes
Topic Author
Posts: 852
Joined: Sat Mar 09, 2019 4:48 pm

Re: Is it or is it not in the interest of the American working class that Boeing goes bankrupt?

Sat Mar 21, 2020 6:37 am

rfields5421 wrote:
Bankruptcies of large corporations always cause more damage to working class people than anyone.
...
But to a lot of people, the bankruptcy meant moving to smaller, less safe apartment. Reduced food budgets, not traveling as often to see children and grandchildren.
...


Your answer is a precise answer to my question. I conclude I formulated the question wrong.
Detroit had an industry which wasn't competitive any more. Against which area in the world Seattle isn't competitive in plane making?
It will be difficult, if not impossible, for the world to do without Seattle.
VW bought Skoda. Rubbish cars, probably rubbish buildings and tools, but lots of qualified workers in one place.

When Bombardier realized that the C-series won't be cheap to produce they should have issued new shares. My assumption is that the main shareholder didn't want to loose control of the company. It wasn't unrealistic for him to expect that the Canadian government would consider Bombardier too big to fail and come to help. It turned out he was wrong. The main shareholder had better agreed that management issues new shares. It was his expectation which ruined the day for all other Bombardier shareholders. If the Canadian government had to tell from the beginning that there will be no help, Bombardier shareholders would have been better off.
The expectations every rescue creates are a serious interference in the economy.
Boeing now shows the same expectation as Bombardier management earlier. Interesting times.

Are there no Canadians on this forum? So what happened to people who work on the A220? Did their salaries/ other benefits decrease?
Why can't the world be a little bit more autistic?

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