Read the Bills Act Coalition

Thursday, December 4, 2008

Putting the Bail Out(S) in Perspective

Posted by MAXIMUS

From the album: Bailout
By Mel Whirley

TRADITIONAL CORPORATION

You have two cows.You sell one and buy a bull. Your herd multiplies, and the economy grows. You sell them and retire on the income.

AMERICAN CORPORATION

You have two cows.You sell three of them to your publicly listed company, using letters of credit opened by your brother-in-law at the bank, then execute a debt/equity swap with an associated general offer so that you get all four cows back, with a tax exemption for five cows. The milk rights of the six cows are transferred via an intermediary to a Cayman Island company secretly owned by the majority shareholder who sells the rights to all seven cows back to your listed company. The annual report says the company owns eight cows, with an option on one more. Sell one cow to buy a new president of the United States, leaving you with nine cows. No balance sheet provided with the release. The public buys your bull.

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