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Of course, the competitors of those companies that didn't get financing went under, or had far higher financing costs (that is, the rate they had to pay on the
by patrickgzill 16y ago
Of course, the competitors of those companies that didn't get financing went under, or had far higher financing costs (that is, the rate they had to pay on the loan was far higher). Something to keep in mind.
- phlux 16y agoCorrect. The issue to take, uh, issue with here is that while this may have had the positive position of keeping things afloat during such a crisis (however manufactured) - the real outcome is that it just further enforces, and more tightly knits, the oligopolistic system in place.
- joe_the_user 16y agoAt the time, Warren Buffet commented on this perverse quality of the bailouts. His profitable companies couldn't get the credit which bankrupt-but-guaranteed companies could.
- nerfhammer 16y agoHe recently wrote a NYT op-ed praising it: http://www.nytimes.com/2010/11/17/opinion/17buffett.html http://www.nytimes.com/2010/11/17/opinion/17buffett.html