Aren't state aids forbidden in the EU?
Historically, only if the company wasn't French. Now it seems it's a free-for-all, unsurprisingly.
German government to bail Lufthansa out of bankruptcy with nearly $10B state aid
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Re: German government to bail Lufthansa out of bankruptcy with nearly $10B state aid
#22Earlier quoted context omitted.
Nope. Because they have already paid all of this in taxes. It means, that the 10 bn won't get 'invested' by the government in another project, e.g., welfare benefits, infrastructure, health, or education. Alternatively, it means: nothing of all of those, but inflation will rise an additional 0.0001% (if the funding source is printing money vs. using tax payer money)
There is no direct link between printing money and inflation. But 0.0001% seems too optimistc. For example the EZB has about 5 Trillion Euros out. 10B more would increase the amount of EZB money by 0.025%.
> There is no direct link between printing money and inflation
what....
Re: German government to bail Lufthansa out of bankruptcy with nearly $10B state aid
#23Regarding US bailouts, can someone here more knowledgeable can help me understand how a company that has been fined tens of millions of dollars for ocean pollution, is not US-based incorporated, does not pay taxes on US soil, is in large part responsible for citizens obesity, and hire less than 0.17% American citizens, got bailed out by Feds to the tune of billions of dollars? https://www.wsj.com/articles/how-fed-int…
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Re: German government to bail Lufthansa out of bankruptcy with nearly $10B state aid
#24Meanwhile American Airlines needs like 12 trillion dollars to keep the lights on. Can't wait for the day where we let that pathetic airline fail.
No, we can't let them fail, that'd be capitalism!
Re: German government to bail Lufthansa out of bankruptcy with nearly $10B state aid
#25The only reason an airline would need a bailout is if they have acquired significant debt that they are unable to service. If the airline is being 'bailed out' what's really happening is the airline's creditors are being bailed out.
The banks can afford to take a haircut on their debt and they can renegotiate terms. Of course, many of the creditors might be unsecured bond holders, which, I'm unsure of how the scam works in Germany, but in the US that effectively is some crappy fund you own in your 401k. So the banks smartly package and sell debt to idiots (common people with a pension/retirement account).
The government has to keep the worthless bond market afloat because everyone's invested in the scam. That helps keep interest rates low so the mega corporations can get free money from bonds that bear interest well below market rates.
Re: German government to bail Lufthansa out of bankruptcy with nearly $10B state aid
#26Based on my experience with Lufthansa. That's an organization that should fail. If anything happens on your journey that is not average, the agents always blame you first.
>If anything happens on your journey that is not average, the agents always blame you first.
So basically every airline ever? Unless you are in the ultra premium VIP exclusive membership club.
Re: German government to bail Lufthansa out of bankruptcy with nearly $10B state aid
#27Based on my experience with Lufthansa. That's an organization that should fail. If anything happens on your journey that is not average, the agents always blame you first.
>If anything happens on your journey that is not average, the agents always blame you first. So basically every airline ever? Unless you are in the ultra premium VIP exclusive membership club.
Nah. Aeroflot, Turkish, Ethiopian and Delta have pretty good customer service.
Re: German government to bail Lufthansa out of bankruptcy with nearly $10B state aid
#28Meanwhile American Airlines needs like 12 trillion dollars to keep the lights on. Can't wait for the day where we let that pathetic airline fail.
No, we can't let them fail, that'd be capitalism!
Many major national carriers have national importance. So, no, they won't go bankrupt. Be it Lufthansa, Air France, Air China, or whatever.
Airlines like Ryanair and Wizz air might be different.
Re: German government to bail Lufthansa out of bankruptcy with nearly $10B state aid
#29Regarding US bailouts, can someone here more knowledgeable can help me understand how a company that has been fined tens of millions of dollars for ocean pollution, is not US-based incorporated, does not pay taxes on US soil, is in large part responsible for citizens obesity, and hire less than 0.17% American citizens, got bailed out by Feds to the tune of billions of dollars? https://www.wsj.com/articles/how-fed-int…
Based on that article, they did not bail out Carnival. The Fed just bought a pile of other assets, which meant that investors had more cash to put into other investments like bonds for Carnival, driving their interest rates on the bond market down.
It was not directly bailed out. Action by the Fed just made all debt investment more attractive and that made more investors compete for such investment, lowering the interest rates Carnival (and every other corporation issuing bonds) faced.
Re: German government to bail Lufthansa out of bankruptcy with nearly $10B state aid
#30Earlier quoted context omitted.
There is no direct link between printing money and inflation. But 0.0001% seems too optimistc. For example the EZB has about 5 Trillion Euros out. 10B more would increase the amount of EZB money by 0.025%.
> There is no direct link between printing money and inflation what....
Academically, there is a link, but it has not been born out in recent times by central bank policy and the resulting economic observations.
https://www.frbsf.org/economic-research/publications/economi...