Finance: What is a Bailout?

What is a Bailout? Bailouts happen when a company is suffering huge losses and is about to go out of business. Some entity gives the failing company a loan, investment, or straight cash in order to help them avoid going out of business.

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Transcript

00:24

the mama figure coming in to pay the bills of

00:27

the derelict deadbeat who misstepped and well now can't make

00:31

payroll The notion of a bailout is a politically charged

00:34

one You can imagine that ford wasn't very happy about

00:38

gm getting such a gift when obama bailed them out

00:41

courtesy of a gift from us taxpayers Yes the bailout

00:45

save gm worker jobs for a while but it also

00:48

said a frightening precedent in this country like what happens

00:51

when the next company manages itself poorly Well the feds

00:55

come in and just bail it out as well with

00:58

no real consequences Well given the ford competes directly with

01:01

gm and ford got no bailout how would you guess

01:05

those workers feel Yeah henry is turning in his grave

01:09

A bailout of greece revolves around its role as a

01:12

kind of edgy international chess piece like right between the

01:15

west and the east kind of like if the west

01:18

doesn't bail out greece will china russia saudi arabia will

01:22

greece is kind of the new cuba in that chess

01:25

game as the u s and russia tussled over the

01:27

management of cuba dot com in the sixties you know

01:30

bay of pigs and all that but greece well simply

01:33

put does not manage itself well It allows for ah

01:36

highly unionized thirty two hour work week with six to

01:40

eight weeks of vacation a year And greece has a

01:42

history of corruption where the wealthy have easy legal vehicles

01:46

behind which to hide their earnings so they pay little

01:49

or no taxes Is it fair to say other countries

01:53

who work their butts off to just keep bailing out

01:56

greece Well then we have california and illinois states both

02:00

likely to go bankrupt in the next decade or so

02:02

swimming under massive government pension liabilities Is it fair to

02:06

take money from the disciplined balanced budget states like utah

02:10

and wyoming in florida and texas and just give that

02:13

money to the derelicts in california and illinois Why would

02:16

that be fair utah florida and texas and the gang

02:19

Don't buy everything they want They respect their budgets but

02:23

some states don't When it's your tax dollars being given

02:27

over in a bailout and it'll be interesting to track

02:30

how you feel Politically everyone loves to bail out cute

02:33

looking derelicts with other people's money When it's your own

02:37

maybe not so much looking at hypocrisy Dot com khun 00:02:41.62 --> [endTime] khun lead by that website Oh