tag:blogger.com,1999:blog-33693245.post2370657040895577385..comments2024-03-04T23:40:58.133+05:30Comments on The Big Picture: Kingfisher acquires DeccanThe Big Picturehttp://www.blogger.com/profile/06018983225756352176noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-33693245.post-46225673572428232672007-06-07T05:04:00.000+05:302007-06-07T05:04:00.000+05:30Well ... if a company collapsed and there was that...Well ... if a company collapsed and there was that danger of an entire industry collapsing, I am sure some white knight may have rescued such companies - Often though excesses lead to unintended, positive consequences that are difficult to predict ... Tom Friedman notes how the excessive build up of communication infrastructure by companies like CICSO/MCI/WorldCom led to inexpensive internet access for companies outside the US and the growth we see - many companies lost significant/almost all of their market value because of such excesses ...(I know, not a good analogy perhaps!) ... This in fact points to one danger with privatizing part of the US Social Security Fund - if the Feds are part owners of companies, one wonders what the heck they may do (in addition to other things that they do) (I am guessing the Central Government made significant investment in infrastructure that they were loath to let lose in value/something else)Krishnanhttps://www.blogger.com/profile/10392990372263068251noreply@blogger.comtag:blogger.com,1999:blog-33693245.post-41899783397569239322007-06-06T16:29:00.000+05:302007-06-06T16:29:00.000+05:30Krishnan, the government had to intervene because ...Krishnan, the government had to intervene because the private industry as a whole was losing money because of ultra-competitive fares. That put in jeopardy the huge investment that had taken place in the industry.<BR/><BR/>-TTRT T Ram Mohanhttps://www.blogger.com/profile/06925858642839337950noreply@blogger.comtag:blogger.com,1999:blog-33693245.post-69042255819167651042007-06-03T05:53:00.000+05:302007-06-03T05:53:00.000+05:30The Civil Aviation Ministry calls a private airlin...The Civil Aviation Ministry calls a private airline to ask them as to why they are accepting losses? Yet another company has bought them - obviously for some assets that will return handsomely I imagine. It would be as if the Secretary of Commerce asking as to why some company could not have raised prices so in some specific quarter they would have made money instead of showing losses! ... I am always leery when someone outside of some company decides that they know better than the people running the company.<BR/><BR/>Ofcourse - when companies fail, they run to the Government for a bail out and so in some cases it may look like some bureaucrat trying to prevent some potential future mishap by reining in some present practice ... (I wonder about all this and the free flow of information through prices and market forces and all that) ...<BR/><BR/>Ofcourse through lobbying, companies do manage to get legislation passed to their benefit and it is not easy for most to understand ... Many US Airlines are now playing that game about their pension obligations and how to estimate future payments and so on ... they could simply say "Sorry, cannot pay you" - and voters then ask the feds to pay up<BR/><BR/>Many years ago, Chrysler was bailed out by the US Fed's - big mistake. True, Iacocca turned things around ... yet, look at the mess. A 36 billion dollar investment (Daimler) had to be got rid off by payment of an additional 5 billion dollars to Cerberus. Oh well ... stuff happens all the time!Krishnanhttps://www.blogger.com/profile/10392990372263068251noreply@blogger.com