4 ms·

What's going to happen to all those retirees? There aren't any 401ks to fall back on are there?

by teyc 15y ago

eduardordm 15y ago
Pretty sad, but they are not in a good situation. To be sure, you need to check current regulation on that. But, if I remember, it's something like: First they will pay all debt they made WHILE on chapter 11 and govt, then workers & retirees, etc. Kodak has some patents, and some other assets, but I doubt it is enough to pay everyone.
- rdtsc 15y ago
  It is interesting that for obsoleted technology patents don't do much. Who cares about say "new innovative color film developing technology"? A large tech company filing for chapter 11 could potentially have a hefty patent portfolio ready to be sold.
  - timjahn 15y ago
    Of course, the question is, how long does it take for that theoretical portfolio to be outdated? Developing film was around until quite recently, until it quickly became obsolete.
    - rdtsc 15y ago
      Yeah, it was a fast transition. It took only 10-15 years or so but it turned a whole market segment upside down. If someone said in 1995 that by 2010 Kodak will be obsolete, I would not have believed them.
      - timjahn 15y ago
        No kidding. Makes me wonder what technologies heavily used today won't be around for my 16 month old son's 10th, 11th, 12th birthdays.
  - ars 15y ago
    No, they have a lot of digital photo patents - they were first to make a digital camera, they just couldn't make them cheaply enough and lost market share rapidly.
ars 15y ago
That what this is for: http://en.wikipedia.org/wiki/Pension_Benefit_Guaranty_Corporation http://en.wikipedia.org/wiki/Pension_Benefit_Guaranty_Corpor... It doesn't cover everything, but it helps a lot.
- ams6110 15y ago
  The PBGC has a total of $102.5 billion in obligations and $79.5 billion in assets (quoting the linked page).
- nradov 15y ago
  The PBGC provides a nice backstop for workers with certain defined benefit pension plans but as a matter of public policy it's a terrible idea and ought to be phased out. The insurance rates it charges are insufficient and so taxpayers are going to get stuck with a huge liability. Its mere existence creates a moral hazard by encouraging employers to make promises they can't keep. The government should encourage a shift to defined contribution plans.
ams6110 15y ago
If there's one thing I hope that people entering adulthood today learn from recent history, it is that you cannot depend on your employer, the government, your union, or any other large impersonal bureaucratic entity to take care of you, individually. You better plan on doing that yourself.

What's going to happen to all those retirees? There aren't any 401ks to fall back on are there?

by teyc 15y ago

What's going to happen to all those retirees? There aren't any 401ks to fall back on are there?

Pretty sad, but they are not in a good situation. To be sure, you need to check current regulation on that. But, if I remember, it's something like: First they will pay all debt they made WHILE on chapter 11 and govt, then workers & retirees, etc. Kodak has some patents, and some other assets, but I doubt it is enough to pay everyone.

rdtsc 15y ago
It is interesting that for obsoleted technology patents don't do much. Who cares about say "new innovative color film developing technology"? A large tech company filing for chapter 11 could potentially have a hefty patent portfolio ready to be sold.
- timjahn 15y ago
  Of course, the question is, how long does it take for that theoretical portfolio to be outdated? Developing film was around until quite recently, until it quickly became obsolete.
  - rdtsc 15y ago
    Yeah, it was a fast transition. It took only 10-15 years or so but it turned a whole market segment upside down. If someone said in 1995 that by 2010 Kodak will be obsolete, I would not have believed them.
    - timjahn 15y ago
      No kidding. Makes me wonder what technologies heavily used today won't be around for my 16 month old son's 10th, 11th, 12th birthdays.
- ars 15y ago
  No, they have a lot of digital photo patents - they were first to make a digital camera, they just couldn't make them cheaply enough and lost market share rapidly.

ars 15y ago

That what this is for: http://en.wikipedia.org/wiki/Pension_Benefit_Guaranty_Corporation http://en.wikipedia.org/wiki/Pension_Benefit_Guaranty_Corpor... It doesn't cover everything, but it helps a lot.

ams6110 15y ago
The PBGC has a total of $102.5 billion in obligations and $79.5 billion in assets (quoting the linked page).
nradov 15y ago
The PBGC provides a nice backstop for workers with certain defined benefit pension plans but as a matter of public policy it's a terrible idea and ought to be phased out. The insurance rates it charges are insufficient and so taxpayers are going to get stuck with a huge liability. Its mere existence creates a moral hazard by encouraging employers to make promises they can't keep. The government should encourage a shift to defined contribution plans.

ams6110 15y ago

If there's one thing I hope that people entering adulthood today learn from recent history, it is that you cannot depend on your employer, the government, your union, or any other large impersonal bureaucratic entity to take care of you, individually. You better plan on doing that yourself.