4 ms·

Can tell you don't have much experience of bankruptcy. Okay, airlines go bankrupt...presumably, airports go bankrupt too...simple, the various assets are "reass

Can tell you don't have much experience of bankruptcy. Okay, airlines go bankrupt...presumably, airports go bankrupt too...simple, the various assets are "reassigned"...true. One big problem: if an airline is bankrupt, what airport is going to give them a slot? I can tell you: no airport, because they will lose that money in bankruptcy. Likewise: what airline will land at a bankrupt airport? Again, no airline. What you are saying is that we should stop all flights into and out and within the US for a period of months (probably years) whilst these cases go through court (and it will probably take years)...is that realistic? Likewise, you appear not to realise how difficult it will be to fire millions of staff and rehire them at other companies. Bankruptcy is neutral in terms of assets, it is not neutral in terms of cost...it is very very very costly. This isn't a hard problem. You are completely wrong that bailouts "keep things in the hands of the same people". This is what largely happened in the US...because the US led insolvent companies go bankrupt (mostly but not always i.e. Fannie/Freddie) most of the companies that were "bailed out" weren't insolvent. But, irregardless, it is very easy to create a package that forces losses...very very easy. I agree with you. Companies that gorged on debt should be punished. It is very easy to do this with new equity issues, preferred issues, etc. without bankruptcy. This should only be, however, for companies that have substantial net debt positions (where I am, one or two airlines were buying back shares but they had/have net cash positions...the issue isn't repurchasing shares, that is just a tax-efficient return of capital, it is being under-capitalised and expecting someone else to capitalise you for free).

dmurray 7y ago
> One big problem: if an airline is bankrupt, what airport is going to give them a slot? I can tell you: no airport, because they will lose that money in bankruptcy. Likewise: what airline will land at a bankrupt airport? Again, no airline. Why would both of these be true? Normally you don't want to sell to a bankrupt customer, or at least you don't give them credit. But you would definitely buy from a bankrupt supplier if they have something you need. Some airports pay airlines, but mostly the cash flows the other way, so the airline should be happy to land at the bankrupt airport.
- hogFeast 7y ago
  No. Airports most certainly do sell stuff to airlines. Do you think airplanes have a little refinery in the back with a million barrels of oil?
  - dmurray 7y ago
    That's again cash flowing from the airline to the airport, so if the airport can keep the fuel flowing, the airline should be OK landing there.
mcguire 7y ago
When one makes personal attacks like, "Can tell you don't have much experience of bankruptcy," it is imperative that you actually know more than the person being attacked. Many, if not most, US airlines have been through bankruptcies before (https://en.wikipedia.org/wiki/List_of_airline_bankruptcies_in_the_United_States https://en.wikipedia.org/wiki/List_of_airline_bankruptcies_i...). Typically, large ones are not grounded; companies go into receivership, where they continue operations as normally as possible while the bankruptcy is settled. Most US airports are public infrastructure. JFK is owned by the City of New York and operated by the Port Authority. O'Hare, Denver, and ATL are owned by Chicago, Denver, and Atlanta, respectively. LAX is "owned and operated by Los Angeles World Airports (LAWA), an agency of the government of Los Angeles." Public institutions such as cities can go into bankruptcy, but it's difficult.
- hogFeast 7y ago
  Correct, but we are talking about multiple airlines going. Not just one or two. And we are talking about them going quickly. Thankfully, you quoted the part of my answer that proved my point. Again and again, you will find solutions that are apparently "obvious" and simple...with no basis in reality. You need to actually understand what is going on.

dmurray 7y ago

> One big problem: if an airline is bankrupt, what airport is going to give them a slot? I can tell you: no airport, because they will lose that money in bankruptcy. Likewise: what airline will land at a bankrupt airport? Again, no airline. Why would both of these be true? Normally you don't want to sell to a bankrupt customer, or at least you don't give them credit. But you would definitely buy from a bankrupt supplier if they have something you need. Some airports pay airlines, but mostly the cash flows the other way, so the airline should be happy to land at the bankrupt airport.

hogFeast 7y ago
No. Airports most certainly do sell stuff to airlines. Do you think airplanes have a little refinery in the back with a million barrels of oil?
- dmurray 7y ago
  That's again cash flowing from the airline to the airport, so if the airport can keep the fuel flowing, the airline should be OK landing there.

mcguire 7y ago

When one makes personal attacks like, "Can tell you don't have much experience of bankruptcy," it is imperative that you actually know more than the person being attacked. Many, if not most, US airlines have been through bankruptcies before (https://en.wikipedia.org/wiki/List_of_airline_bankruptcies_in_the_United_States https://en.wikipedia.org/wiki/List_of_airline_bankruptcies_i...). Typically, large ones are not grounded; companies go into receivership, where they continue operations as normally as possible while the bankruptcy is settled. Most US airports are public infrastructure. JFK is owned by the City of New York and operated by the Port Authority. O'Hare, Denver, and ATL are owned by Chicago, Denver, and Atlanta, respectively. LAX is "owned and operated by Los Angeles World Airports (LAWA), an agency of the government of Los Angeles." Public institutions such as cities can go into bankruptcy, but it's difficult.

hogFeast 7y ago
Correct, but we are talking about multiple airlines going. Not just one or two. And we are talking about them going quickly. Thankfully, you quoted the part of my answer that proved my point. Again and again, you will find solutions that are apparently "obvious" and simple...with no basis in reality. You need to actually understand what is going on.