A Thanksgiving THANKS (for bankruptcy)

I am an optimist at heart. Senator McCain was ridiculed during the campaign for saying the fundamentals of our economy are strong (there is another post a ways back about that, so read it if you care). They are. When allowed to function, the free market economy is the best system devised. Are there inequalities? - Yes. Are there people that will go broke? - Yes. But, if left to be truly free, there will be a much larger number of people that accumulate more wealth. Our problem now is we are being led into a disastrous economic situation by people that think the down times and the "losers" in a capitalistic system can be turned around and/or saved. That is insanity. There can be no good without bad. There can be no winner without losers. To appreciate the light, one must experience darkness. The "feel-good" notion that we can bail out all the downtrodden and speculators that lost, is not only wrong - it is suicidal to our economy. Here is a blog by a business reporter. It is OK, read it if you like. I am putting this link here specifically for you to listen and watch the first two video clips linked on her blog. Mr. Rogers (no sweaters or slippers here) is one of the most successful investors ever. He knows economies and business. His comments are chilling. The second two - not so much. Watch them if you like. http://glickreport.blogs.foxbusiness.com/2008/11/25/jim-rogers-citi-should-have-been-let-to-fail/ I truly feel that if left alone, and if the weak are allowed to fail; our nation and its economy will roar back with a vengeance. I also am beginning to feel that with all the bail outs and money being thrown around - we may be in a LOT of trouble. I took an economics course in the late 70s. We were taught that an unemployment rate of about 6% was the absolute minimum that a healthy economy could achieve. We are just now at 6.5% nationally. The 6% floor was said to be the bottom due to the fact that there are many people that just do not want to work! Oh they may go to job interviews or even take jobs, but they are very happy just getting by on charity or government handouts. To try to make these folks a permanent part of the work force was considered to expensive. Also, when the unemployment went too low, the cost of filling new jobs was too high for growing companies -ie there was way too much competition for the available good employees and wages went to a prohibitive level. We have been under 6% now for the better part of 15 years! We were under 5% for a large portion of that! Here are some famous (and not so) companies that have filed for bankruptcy. Yes, some went out of business. But, some are still around, some were bought out by successful businesses, and some morphed into something else entirely. But, they used bankruptcy to help when they got in bad shape financially. Here is the list: Aladdin Gaming, LLC (Las Vegas Hotel Casino) (2001) ABB Lummus Global, Inc. (Petroleum Refining) (2006) Aloha Airlines, Inc. Allegiant Air, Inc. American Banknote Corporation (1999) American Federation of Television and Radio Artists / AFTRA (1982) America Online Latin America, Inc. (2005) American Restaurant Group, Inc. (2004) Ameridebt (2004) AMF Bowling Worldwide, Inc. (2001) AtA Airlines (2008) Atkins Nutritionals, Inc. (2005) Baldwin Piano & Organ Company (2001) Bally total fitness holding Corporation Beliefnet, Inc. Ben Franklin Retail Store, Inc. Bethlehem Steel Corporation (2001) Big Buck Brewery & Steakhouse, Inc. (2004) Birch Telecom, Inc. (2005) The Bombay Company, Inc. Bugle Boy industries Burlington Industries Inc. (2001) Carolco Pictures Inc. (1995) Casual Male Corp. CD Warehouse, Inc. Champion Parts, Inc. Chiquita Brands International Inc. (2001) Clothestime Stores, Inc. Color Tile, Inc Continental Airlines Inc. (1967 & 1984) Converse Inc. (2001) Cosmetic Center, Inc. County Seat Stores, Inc (1996,1999) Dairy Mart Convenience Stores Inc. (2001) Death Row Records (2006) Delphi Corporation (2005) Delta Airlines Inc. (2005) Diamond brands inc. Dow Corning Corporation (1995) Drug Emporium, Inc. (2001,2003) Eastern Airlines Inc. (1991) Easyriders, Inc. Edwards Theatres Circuit, Inc. Einstein/Noah Bagel Corp. Enron Corporations (2001) eToys Inc. (2001) Excite@Home (2001) Factory 2-U Stores, Inc. Family Golf centers, Inc. Farm Fresh, Inc. First City Banc. Of Texas Fitzgeralds Gaming Corp. Flooring America, Inc. Frank’s Nursery & Crafts, Inc. (2004) Frederick's of Hollywood Inc. (2000) Fresh Choice, inc Friedmans Inc. (2005, 2008) Furrs Restaurant Group, Inc. Fruit of the Loom Inc. (1999) G. Heileman Brewing Co., Inc. Gadzooks, Inc. (2004) Garden Bontanika, Inc. General homes Corporation Gibraltar Financial Corp. Greyhound Lines, Inc. Gulf States Steel, Inc. Happy Kids, Inc. (2005) Hawaiian Airlines, Inc. Hispanic Television Network, Inc. Hollywood Casino Shreveport (2004) Homes.com,LLC Homeseekers.com,Inc. Houlihans Restaurants, Inc. Huffy Corporation Imperial Sugar Company Just For Feet, Inc. KB Toys, Inc. (2004) Kmart Corporation (2002) L.A.Gear, Inc Laidlaw, Inc. Lionel Corporation (1967 & 1984) Loan Fabrics Corporation Loehmann’s, Inc. Loews Cineplex Entertainment, Inc. (2000) Logix Communications enterprises, Inc London Fog Group, Inc. Maidenform Inc. (1997) Mars Music, Inc. Marvel Entertainment Group (1996) Mercury finance Company Midway airlines Corp Montgomery Ward Inc (1997 & 2000) Mortgage Lenders Network USA, Inc. Moto Photo, Inc. Motor City Five/MC5 rock group of the 1960s (1970) Musicland Holding Corp. (2006) Napster, Inc. NextCard, Inc. Northwest Airlines (2005) Onieda Ltd. Orion Pictures Corporation (1992) Outboard Marine Corp. Owens Corning Corporation (2000) Pan Am Corporation (1998) Payless Cashways, Inc. (1997,2001) Planet Hollywood International Inc.(1999 & 2001) Polaroid Corporation (2001) Purina Mills Inc. (1999) Quality Home Loans, Inc. Quebecor World (USA), Inc. Rand McNally & Company Regal Cinemas Inc. (2001) Reliant Energy Channelview LP Resorts International Inc. (1994) Roadhouse Grill, Inc. (2002,2007) Ronco Corporation Safety-Kleen Corporation Samuels Jewelers, Inc. Schlotzskys Inc. (2004) Schwinn/GT Corp Service Merchandise Company, Inc. Seven Up/RC Bottling Company of So. CA,Inc. Sharper Image Corporation Shuttle America Corp. Silicon Graphics, Inc. (2006) Singer Company (1999) Sizzler International (1996) Smith Corona Corporation (1995) Southland Corporation (7-11 stores) (1990) Spiegel, Inc. Stan Lee Media, Inc. Standard Automotive Corp. Star Telecommunications. Inc. State Line casino Stratosphere Corporation Strouds, Inc. Sun Country Airlines, Inc. Sunbeam Corporation (2001) Swissair Group Inc. (2001) SyQuest Technology, Inc. Talkpoint Communications, Inc. Talon Automotive Group, Inc. Texaco Texas American Bancshares Texas Commercial Energy, LLC Texas Equipment Corp. Texas International Co. Texas Petrochemicals LP The Roman Catholic Archdiocese of Portland, Oregon (2004) Thinkpath Inc. Thomaston Mills, Inc. Todays man, Inc. Top-Flite Golf Company Tower Automotive, Inc. Toysmart.com (2000) TLC rock group (1995) Trans World Airlines Inc. /TWA (1995 & 2000) Trans Texas Gas Corp. Tristar Corp. Trump Hotel & Casino Resorts, Inc. Twinlab Corporation Ultra Stores,Inc. United Artists Theatre Co. United Petroleum Corp. United States Leather, Inc. US Airways Group, Inc. (2004) USA Commercial Mortgage Company US Office Products Company (mail boxes etc. stores) (2001) U.S. Wireless Corp. Vangaurd Airlines, Inc Venture Stores, Inc Vlasic Foods International Inc. (2001) Western Union Corporation (1993) Wherehouse Entertainment, Inc. Wickes Furniture Company, Inc. Winn-Dixie Stores, Inc. (2005) WorldCom, Inc XO Communications, Inc. Zany Brainy Zenith Electronics Corporation (1999) One of the reasons that the car companies (and some others like airlines) are NOT being allowed to declare bankruptcy is the unions. Now unions are the subject of a whole other blog for later (and I have done some - look back). The bailout for the car makers should be seen as a bailout for the unions. The unions got Obama and the democrats elected this time. Their payoff is to protect and grow union jobs. The only thing that will save American car companies long term is to eliminate or radically change the union contracts they have today. THAT is one of the purposes of bankruptcy - to cancel contracts and leases that are not in the best interest of a continuing business. So, now we have to give a TAXPAYER bailout to the car companies so the unions can keep their contracts in place. These contracts amount to thousands per car overhead that GM, Ford, and to some extent Chrysler pays per car that Toyota, Nissan, etc. do not. It is really amazing that Detroit has survived at all. Give them a level playing field and they will not just compete, they will win. The problem with "government" bailouts is - (all together now) THERE IS NO GOVERNMENT MONEY!! The only money a government has is from its governed. Any money given to banks, car companies, airlines, mortgage lenders, hot dog vendors, etc - is FROM US! The government is taking money from those that are successful and good at managing their money and giving it to those that have proven they are not! That is a recipe for disaster. Failed businesses and people must be allowed to fail. People that cannot pay their mortgage, must be allowed to lose their homes. Companies that cannot compete must be allowed to reorganize (that's what bankruptcy is for) and restart, or fail. The weak, dumb, poorly financed, badly conceived, ineptly managed, and uncompetitive must not be preserved. That weakens us all. Here is what we all MUST do - (I have and do often) Write your congressman and senator. Write our new savior Obama. Call neighbors, friends, and co-workers. Tell the government to STOP giving away your money to failures. GM and/or Citibank declaring bankruptcy will NOT take down this country. Allowing them to continue with failed policies and management with our money may. If you wanted a feel good piece about Thanksgiving - go to last year's post. I was in a better mood.