Originally Posted by
bababouey
ok, so start making some predictions. If we stay at or near current revenue levels will we go bankrupt? If we stay in a recession for a couple of years will we go bankrupt? If we get a 9/11 or pandemic again, what then? I realize govt largesse is a wildcard, but start making some hard predictions.
Not making predictions. Just posting relevant facts to - you know - the TOPIC of the thread?
Laws and practices have changed since the last time AA declared bankruptcy. Just the pension situation for instance. AMR was able to blow off paying ~$10 billion in traditional pension costs back then. The laws regarding the Pension Benefit Guarantee Corporation have been changed, but also most traditional pensions have gone away - been replaced by 401ks, which reduces the incentive for a company to declare bankruptcy. Nor can any of us predict the next pandemic or the government’s (over) reaction to it. But there are still pertinent FACTS that ultimately have their effects - the cost of borrowing for instance. I can’t tell you if the Fed is going to raise interest rates by 75 or 100 basis points this week, but either one is going to have an effect on cost of debt service and a non-trivial one.
And you better believe that ALL the CFOs are watching them.