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The Airlines want a $50 billion bailout. Trump says it's not the Airlines fault Login/Join 
Go ahead punk, make my day
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quote:
Originally posted by Hay2bale:
I know that if there were no airlines, the Chinese Death Virus would not be here in the US.
It could have come in your row boat... Wink
 
Posts: 45798 | Registered: July 12, 2008Reply With QuoteReport This Post
Lawyers, Guns
and Money
Picture of chellim1
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Without bailouts some of the airlines will be absorbed by others. The ones that survive will “thrive” just fine when the economy begins to recover. When there is demand for air travel there will be companies to provide service.

Exactly.
There is no need for "bailouts" in a capitalist economy. Sure, some airlines may be over-leveraged, under-capitalized and won't survive in their current form. So be it. Someone will buy the assets.

There should have been no bailout of GM in 2008-2009. All bailouts do is promote and prop up inefficiencies.



"Some things are apparent. Where government moves in, community retreats, civil society disintegrates and our ability to control our own destiny atrophies. The result is: families under siege; war in the streets; unapologetic expropriation of property; the precipitous decline of the rule of law; the rapid rise of corruption; the loss of civility and the triumph of deceit. The result is a debased, debauched culture which finds moral depravity entertaining and virtue contemptible."
-- Justice Janice Rogers Brown

"The United States government is the largest criminal enterprise on earth."
-rduckwor
 
Posts: 24752 | Location: St. Louis, MO | Registered: April 03, 2009Reply With QuoteReport This Post
Member
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quote:
Originally posted by Hay2bale:
I know that if there were no airlines, the Chinese Death Virus would not be here in the US.



No, you don't know that. You don't know that at all.

More lies do not make a truth.
 
Posts: 6650 | Registered: September 13, 2006Reply With QuoteReport This Post
Ammoholic
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quote:
Originally posted by chellim1:
All bailouts do is promote and prop up inefficiencies.

And get incumbents re-elected.

While I agree that in a perfect world there should be no bailouts, a government that shuts down the economy to fight the virus then doesn’t print a metric sh*t ton of money and distribute it to try to ease the pain will not get a second term.

PDJT could have gone all hard capitalist and decided “Full speed ahead on the economy! Everybody dies eventually, what’s the big deal?” But something tells be that if we ended up anything like Italy he would have been a one trick pony with that approach too.

There may have been a better approach he could have taken, but I’m not going to second guess him. And there’s no way to know anyway. We live in a VERY complex system. Any proclamations that “x” would have worked better, whatever “x” may be, are only guesses.
 
Posts: 7163 | Location: Lost, but making time. | Registered: February 23, 2011Reply With QuoteReport This Post
Ammoholic
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quote:
Originally posted by sns3guppy:
quote:
Originally posted by Hay2bale:
I know that if there were no airlines, the Chinese Death Virus would not be here in the US.



No, you don't know that. You don't know that at all.

More lies do not make a truth.

It might have taken a little longer to get here, but I certainly would not bet that a boat couldn’t have brought it across.
 
Posts: 7163 | Location: Lost, but making time. | Registered: February 23, 2011Reply With QuoteReport This Post
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Given the number of cases on cruise ships, with people confined to a small bit of floating real estate for extended periods, and a lot of personal interaction, boats do seem an ideal environment for passing along the disease.
 
Posts: 6650 | Registered: September 13, 2006Reply With QuoteReport This Post
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It’s called privatizing profits and socializing losses. The airline industry has been the biggest offender here. There is no rational defense for this .
 
Posts: 2714 | Registered: March 22, 2010Reply With QuoteReport This Post
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Funny how these bailouts work. My tax money subsidizes them but I get no price reduction passed along to me. We bailed out Auto companies and all we got was the privilege to buy overpriced cars.


No one's life, liberty or property is safe while the legislature is in session.- Mark Twain
 
Posts: 3661 | Location: TX | Registered: October 08, 2005Reply With QuoteReport This Post
Thank you
Very little
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I don't see where giving the Airlines crap about the virus coming across on them is a valid reason for not bailing them out.

The reason for not bailing them is out is that 1) we shouldn't be bailing anyone out, B) they have spent all the profits they can to buy back shares in order to create wealth for the investors, which is legal, and not a problem per se, however, it hurts them in bad times.

It's not the taxpayers who should carry the financial burden of a short term stock inflation program that burned up cash.

If the government wants to help keep people alive, then bail out the small businesses that are dying because of social distancing rules.

The result of all these CYA actions , the closure of businesses, curfews, etc is really hurting the small employers the most. These are the jobs that will be permanently lost, the Airlines will always recover. Bill and Marys family diner will not...
 
Posts: 24498 | Location: Gunshine State | Registered: November 07, 2008Reply With QuoteReport This Post
Lawyers, Guns
and Money
Picture of chellim1
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quote:
The reason for not bailing them is out is that 1) we shouldn't be bailing anyone out, B) they have spent all the profits they can to buy back shares in order to create wealth for the investors, which is legal, and not a problem per se, however, it hurts them in bad times.

It's not the taxpayers who should carry the financial burden of a short term stock inflation program that burned up cash.


Yep.

After Blowing $4.5 Trillion On Buybacks, US Execs Demand Taxpayer-Funded Bailouts Of Shareholders

The Trump administration is putting together a rumored trillion-dollar-plus stimulus package that will include taxpayer funded bailouts of Corporate America, according to leaks cited widely by the media. Trump in the press conference today singled out $50 billion in bailout funds for US airlines alone. A bailout of this type is designed to bail out shareholders and unsecured creditors. That’s all it is. The alternative would be a US chapter 11 bankruptcy procedure which would allow the company to operate, while it is being handed to the creditors, with shareholders getting wiped out.

So get this: The big four US airlines – Delta, United, American, and Southwest – whose stocks are now getting crushed because they may run out of cash in a few months, would be the primary recipients of that $50 billion bailout, well, after they wasted, blew, and incinerated willfully and recklessly together $43.7 billion in cash on share buybacks since 2012 for the sole purpose of enriching the very shareholders that will now be bailed out by the taxpayer (buyback data via YCHARTS):



Share buybacks were considered a form of market manipulation and were illegal under SEC rules until 1982, when the SEC issued Rule 10b-18 which provided corporations a “safe harbor” to buy back their own shares under certain conditions. Once corporations figured out that no one cared about those conditions, and that no one was auditing anything, share buybacks exploded. And they’ve have been hyped endlessly by Wall Street.

The S&P 500 companies, including those that are now asking for huge bailouts from taxpayers and from the Fed, have blown, wasted and incinerated together $4.5 trillion with a T in cash to buy back their own shares just since 2012:

And those $4.5 trillion in cash that was wasted, blown, and incinerated on share buybacks since 2012 for the sole purpose of enriching shareholders is now sorely missing from corporate balance sheets, where these share buybacks were often funded with debt.

And the record amount of corporate debt – “record” by any measure – that has piled up since 2012 has become the Fed’s number one concern as trigger of the next financial crisis. So here we are.

In 2018, even the SEC got briefly nervous about the ravenous share buybacks and what they did to corporate financial and operational health. “On too many occasions, companies doing buybacks have failed to make the long-term investments in innovation or their workforce that our economy so badly needs,” SEC Commissioner Jackson pointed out. And he fretted whether the existing rules “can protect investors, workers, and communities from the torrent of corporate trading dominating today’s markets.”

Obviously, they couldn’t, as we now see.

Enriching shareholders is the number one goal no matter what the risks. These shareholders are also the very corporate executives and board members that make the buyback decisions. And when it hits the fan, there is always the taxpayer or the Fed to bail out those shareholders, the thinking goes. But this type of thinking is heinous.

Boeing is also on the bailout docket. Today it called for “at least” a $60-billion bailout of the aerospace industry, where it is the biggest player. It alone wasted, blew, and incinerated $43 billion in cash since 2012 to manipulate up its own shares until its liquidity crisis forced it to stop the practice last year, and its shares have since collapsed (buyback data via YCHARTS):

If Boeing’s current liquidity crisis causes the company to run out of funds to pay its creditors, it needs to file for chapter 11 bankruptcy protection. Under the supervision of the Court, the company would be restructured, with creditors getting the company, and with shareholders likely getting wiped out.

Boeing would continue to operate throughout, and afterwards emerge as a stronger company with less debt, and hopefully an entirely new executive suite and board that are hostile to share buybacks and won’t give in to the heinous clamoring by Wall Street for them.

No one could foresee the arrival of the coronavirus and what it would do to US industry. I get that. But there is always some crisis in the future, and companies need to prepare for them to have the resources to deal with them.

A company that systematically and recklessly hollows out its balance sheet by converting cash and capital into share buybacks, often with borrowed money, to “distribute value to shareholders” or “unlock shareholder value” or whatever Wall Street BS is being hyped, has set itself up for failure at the next crisis. And that’s fine. But shareholders should pay for it since they benefited from those share buybacks – and not taxpayers or workers with dollar-paychecks. Shareholders should know that they won’t be bailed out by the government or the Fed, but zeroed out in bankruptcy court.
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The eventual costs of enriching shareholders recklessly in a way that used to be illegal must not be inflicted on taxpayers via a government bailout; or on everyone earning income in dollars via a bailout from the Fed.

The solution has already been finely tuned in the US: Delta, United, American, and other airlines already went through chapter 11 bankruptcies. They work. The airlines continued to operate in a manner where passengers couldn’t tell the difference. The airlines were essentially turned over to creditors and restructured. When they emerged from bankruptcy, they issued new shares to new shareholders, and in most cases, the old shares became worthless. The new airlines emerged as stronger companies – until they started blowing it with their share buybacks.

Companies like Boeing, GE, any of the airlines, or any company that blew this now sorely needed cash on share buybacks must put the ultimate cost of those share buybacks on shareholders and unsecured creditors. Any bailouts, whether from the Fed or the government, should only be offered as Debtor in Possession (DIP) loans during a chapter 11 bankruptcy filing where shareholders get wiped out.

In other words, companies that buy back their owns shares must be permanently disqualified for bailouts, though they may qualify for a government-backed DIP loan in bankruptcy court if shareholders get wiped out. Because those proposed taxpayer and Fed bailouts of these share-buyback queens are just heinous.

https://www.zerohedge.com/mark...ailouts-shareholders



"Some things are apparent. Where government moves in, community retreats, civil society disintegrates and our ability to control our own destiny atrophies. The result is: families under siege; war in the streets; unapologetic expropriation of property; the precipitous decline of the rule of law; the rapid rise of corruption; the loss of civility and the triumph of deceit. The result is a debased, debauched culture which finds moral depravity entertaining and virtue contemptible."
-- Justice Janice Rogers Brown

"The United States government is the largest criminal enterprise on earth."
-rduckwor
 
Posts: 24752 | Location: St. Louis, MO | Registered: April 03, 2009Reply With QuoteReport This Post
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DAL 8K filing today.

https://ir.delta.com/financials/default.aspx



To: Delta Colleagues Worldwide
From: Ed Bastian, CEO
Subject: PROTECTING DElTA’S FUTURE As the COVID-19 (coronavirus) pandemic progresses globally, its impact on our business continues to grow. To contain the virus, social distancing has become
widespread and new travel directives are being enacted, now including more than 40 nations worldwide.
First and foremost, I want to remind everyone of the importance of your health and safety. It is safe to travel, but always make sure you are taking the necessary
steps to ensure your health and that of our customers and our people. The CDC has important guidelines available, so please follow all necessary precautions.
Following the national emergency that was declared by the U.S. President, demand for travel has dropped significantly. Revenue for the month of March is now
expected to decline by almost $2 billion over last year, with our projection for April falling even more. Therefore, we will continue to make significant capacity
reductions with a 70 percent systemwide pullback planned until demand starts to recover. Our international operation will take the largest reduction, with over 80
percent of flying reduced over the next two to three months.
We are having constructive discussions with the White House and Congress, and remain optimistic that our industry will receive support to help address this crisis.
That said, we have to continue to take all necessary self-help measures. Cash preservation remains our top financial priority right now. Making swift decisions now
to reduce the losses and preserve cash will provide us the resources to rebound from the other side of this crisis and protect Delta’s future.
We are deferring nearly all of our capital spending, including all new aircraft deliveries, until we have better clarity on the duration and severity of the situation.
In addition, we are looking to secure more than $4 billion in cash savings in the June quarter alone. This will include capacity-related savings as we suspend flying,
and we are also targeting expense reductions from: · All Delta officers will take a 50 percent pay cut through June 30, with directors and managing directors taking a 25 percent cut during that same period. · As I mentioned last week, I’ve cut my own salary by 100 percent through the next six months. Our Board of Directors elected to forego their
compensation over the next six months as well. · With fewer customers flying, we need less space in airports. Among other initiatives, we will temporarily consolidate airport facilities in Atlanta and other
locations as necessary and close the majority of our Delta Sky Clubs until demand recovers. · We are reducing our active fleet size by parking at least half of our fleet – more than 600 aircraft. We also will be accelerating retirements of older aircraft
like our MD-88/90s and some of our 767s. · We are reducing any maintenance spend that is not necessary to support the safety of our operation. · We have reduced most contractor spend, except where needed to support the operation.
1
Voluntary leaves are one of the best and most immediate ways you can help as we strive to protect jobs and pay. I want to thank each of the roughly 10,000 Delta
people who have already volunteered and I urge everyone, especially our merit employees, to seriously consider whether a temporary leave makes sense for you
and your family right now. Please remember that you will continue to have access to your health and flight benefits while on leave.
As we draw down our operation, I know how painful it is to essentially hit the “pause button” on so many things that are core to what we do for our customers and
our mission to connect the world. But what will never stop is the spirit of the Delta people, which is shining through brighter than ever even in this dark moment. I
have received hundreds of emails and messages from my Delta colleagues over the past week, and your passion, commitment and confidence in our future is truly
inspiring.
In particular I want to thank the Reservations and Customer Care team, who are doing incredible work managing an unprecedented volume of calls and taking care
of our customers who need to adjust their travel plans.
Make no mistake – we will get through this. This is a temporary health crisis and an end will, hopefully soon, be in sight. Never underestimate the power of travel
as an essential service to our world. All of our work over the past decade to fortify our company and transform our business model will serve us well in the weeks
and months ahead, as we endure and, eventually, recover.
Please continue to make the health and safety of each other and our customers our top priority. Wherever possible, we are moving to have our people work
remotely to reduce the risk of transmission. For those working in the operation, continue to always follow our safety and security guidelines to minimize
distractions, and call a safety time-out when needed. And please be mindful in your personal lives to take steps to protect yourself and your loved ones, including
social distancing and recognition of those who are most vulnerable, including the elderly and those in poor health. Be aware that if your doctor advises you to stay
home because you may have been exposed to COVID-19, you will be paid and won't have to deduct that time from your PPT bank.
I know everyone is concerned about the security of your jobs and pay. Given the uncertainty about the duration of this crisis, we are not yet at a point to make any
decisions. And those are very painful decisions to even consider. But know that my No. 1 priority is taking the very best care of all of you. In this unpredictable
environment we can’t take any options off the table, but any steps that would affect your jobs or pay rates would be the absolute last thing we would do, and only if
necessary to secure Delta’s long-term future.
I will be in touch again by the end of the week with additional updates as we navigate this together. Thank you for all you are doing for each other, for our
customers, and for your communities and your loved ones in this unprecedented time.
Ed



"Freedom is a light for which many men have died in darkness."
 
Posts: 212 | Location: FL USA | Registered: February 03, 2017Reply With QuoteReport This Post
10mm is The
Boom of Doom
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I could support industry bailouts with a couple caveats. Until loans are fully repaid with interest: no share buy backs, no dividends, no bonuses, no employee stock option exercises or restricted stock.




God Bless and Protect the Once and Future President, Donald John Trump.
 
Posts: 17591 | Location: Northern Virginia | Registered: November 08, 2008Reply With QuoteReport This Post
Banned
posted Hide Post
quote:
Originally posted by sns3guppy:
quote:
Originally posted by Hay2bale:
I know that if there were no airlines, the Chinese Death Virus would not be here in the US.



No, you don't know that. You don't know that at all.

More lies do not make a truth.


The funny part is that he would be the first one to whine (maybe second after Ballsy Hallsy) about gun manufacturers being blamed when they are sued for gun violence that is beyond their control.
 
Posts: 2347 | Registered: October 05, 2005Reply With QuoteReport This Post
Tinker Sailor Soldier Pie
Picture of Balzé Halzé
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quote:
Originally posted by sigwylde:

The funny part is that he would be the first one to whine (maybe second after Ballsy Hallsy) about gun manufacturers being blamed when they are sued for gun violence that is beyond their control.


Still at it, eh? Why so petty and angry? Personal problems at home? Every single post of yours has been a personal attack on other members. You know, we're here for you if you decide you want to get some help.


~Alan

Acta Non Verba
NRA Life Member (Patron)
God, Family, Guns, Country

Men will fight and die to protect women... because women protect everything else. ~Andrew Klavan

 
Posts: 31126 | Location: Elv. 7,000 feet, Utah | Registered: October 29, 2012Reply With QuoteReport This Post
Get Off My Lawn
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quote:
Originally posted by sigwylde:

The funny part is that he would be the first one to whine (maybe second after Ballsy Hallsy) about gun manufacturers being blamed when they are sued for gun violence that is beyond their control.


Serious question, I have been noticing from a distance- what the fuck is your problem?



"I’m not going to read Time Magazine, I’m not going to read Newsweek, I’m not going to read any of these magazines; I mean, because they have too much to lose by printing the truth"- Bob Dylan, 1965
 
Posts: 17429 | Location: Texas | Registered: May 13, 2003Reply With QuoteReport This Post
Peace through
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Banned
 
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Sigforum K9 handler
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Originally posted by parabellum:
Banned


Quarantine in full effect. Big Grin

That would be such a funny CUT




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"It's a bold strategy, Cotton. Let's see if it works out for them"



 
Posts: 37252 | Location: Logical | Registered: September 12, 2004Reply With QuoteReport This Post
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Originally posted by midwest guy:
The big 5 airlines over the last several years have directed 95% of free cash flow to stock repurchases. Boeing has had repurchase of around $100B.


Which ironically was all lost over the past week.

The sad truth is that the Federal Government will always be the insurer of last resort in this country. Instead of lamenting about it, we should accept it and require that businesses/individuals who engage in risky behavior pay a premium to cover such behavior.

Too big too fail? Fine. But you pay a premium to the .gov before you pay a dividend to your shareholders.
 
Posts: 6720 | Location: Virginia | Registered: January 22, 2001Reply With QuoteReport This Post
come and take it
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I have worked at airports for the last 12+ years, and I am very familiar with the small city of businesses that exist around them to keep them running. The fact that Trump stopped european flights 7 days ago and that the airlines already have their hands out pisses me off to no end. If the airlines cannot weather a 7 day crisis then they need to die and be replaced by better business people. I know they are looking ahead and this is going to last longer, but it still pisses me off. They should have been looking ahead and saved some cash for a rainy day, but now they know they can just go get food stamps from the gov. Privatizing profits and socializing losses is getting us in big trouble.

The U.S. cannot keep doing bailouts. The problem is the Federal Reserve has figured out how to bailout a minor recession, we just keep kicking the can down the road. If we keep avoiding minor shakeouts (which are healthy for capitalism) and soon we are going to have another great depression. The Fed won't have an answer for that one, air travel and everything else will stop for a decade while the world economy completely resets.




I have a few SIGs.
 
Posts: 1965 | Location: Texan north of the Red River | Registered: November 05, 2003Reply With QuoteReport This Post
His diet consists of black
coffee, and sarcasm.
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Humans have spread diseases by their travels since long before there were airlines. Europeans on wooden sailing ships brought smallpox and measles to the New World. Before that, it is believed, the Mongols brought the black plague to Europe on horseback. We don't blame the shipping industry or the horses.

This is a separate issue from whether or not the airlines should get a bailout.

This message has been edited. Last edited by: egregore,
 
Posts: 28899 | Location: Johnson City, TN | Registered: April 28, 2012Reply With QuoteReport This Post
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