“As a long-time investor, I always keep in mind that things come out of left field that can wreck the market.”
Agreed, makes you wonder what a company like Hertz is doing only able to withstand a couple months of shock before reorganizing. Of course senior management gets rewarded thru the process. Not like there will be heavy claw backs and conversely many teams take fat cash bonuses right before the BKs doing a cash grab before creditors. That’s likely why they end up in those positions unable to weather storms. They know they are personally safe.
That’s a problem IMO, it creates these structural problems with debt from companies keeping up with the Joneses like we saw from borrowed $ spent on share buybacks enriching mngmnt further for example.
What’s the downside? Government handouts if in a bind? And if the fed says no, then reorganization thru BK where mngmnt keeps its jobs and often gets sweet equity stakes coming out of BK? That sounds like upside for them unfortunately.
IMO only.
I don't mind stealing bread from the mouths of decadence... But I can't feed on the powerless when my cup's already overfilled.
-Temple of the Dog
