How the Goodfellas @ Bain make their nut

[degsme]

I think that it is part and parcel of what happens. The morally bankrupt issue at hand is why would the government even allow such a thing to be dischargable in bankruptcy?

Um because people Like Romney have made very very large political contributions to the GOP heads of the banking and financial regulatory committees from Reagan onwards. And in return Congress passed into law, and Reagan, GHWB and GWB signed these bills into law.

yes and?

Do, I think that it is fair that they do that to pension funds? No, but then, I don't make the laws.

But again, as the MANAGING DIRECTOR of Bain, Mitt Romney HAD THE CHOICE to NOT touch the workers' pension plans. No law REQUIRED him to do so. Yet HE CHOSE to beggarize those workers so that Bain (and he himself) would turn a bigger profit.

Again the question stands. Why would you vote for a man who does that to hard working middle class individuals?

Why would you consider it "good business experience" that is relevant to "leading the nation back to growth" for a man to take money out of programs (pension plans) that DIRECTLY AND EFFICIENTLY invest in Job Creation - and instead transfer those funds to his private accounts where they are LESS EFFECTIVE at creating jobs?

 

[degsme]

how is the current payroll tax cut ... tough decision? does it defund SS by reducing the revenue stream?

Its a "tough decision" because in the long long term, it is bad policy.
But failing to do so is bad policy in the long term and the medium term - given the options that a Filbuster Congress offered the POTUS.

Choosing between two bad options is always a tough decision.

 

[Lukey]

An anti-capitalist hit piece from a decidedly progressive economic research outfit. I hope you aren't suggesting this is an unbiased report!!!

Are their examples of "vulture capitalism" where private equity buys a stumbling business and strips it of its assets before it goes under? Sure, but as Conneib points out above, the owners who let the business get into that precarious state are the ones who should receive your criticism. The idea that private equity outfits buy perfectly healthy companies and destroy them in an effort to squeeze out a quick profit is absurd. If the company is healthy, the owners either keep it or sell out to another company or private owner to operate. Private equity only gets a shot at wounded businesses. They need restructured in order to survive. Sometimes that means laying off unneeded staff or closing unprofitable plants or (God forbid) sending (currently unprofitable) production overseas where it can be done profitably. And sometimes it means taking it through bankruptcy to shed unsustainable contracts (including with unions) but the idea that they would (or even could) do this by choice with a perfectly healthy company shows a complete misunderstanding of bankruptcy law. And yes, they will strip out some of the assets and sell them to mitigate their downside risk. This is free market capitalism. The money they made by restructuring these businesses was freed up to be invested in new ideas that created jobs in a more profitable market. America's economy is (or at least was) the most vibrant in the world precisely because of these kinds of activities.

 

[Craig]

An anti-capitalist hit piece from a decidedly progressive economic research outfit. I hope you aren't suggesting this is an unbiased report!!!

Are their examples of "vulture capitalism" where private equity buys a stumbling business and strips it of its assets before it goes under? Sure, but as Conneib points out above, the owners who let the business get into that precarious state are the ones who should receive your criticism. The idea that private equity outfits buy perfectly healthy companies and destroy them in an effort to squeeze out a quick profit is absurd. If the company is healthy, the owners either keep it or sell out to another company or private owner to operate. Private equity only gets a shot at wounded businesses. They need restructured in order to survive. Sometimes that means laying off unneeded staff or closing unprofitable plants or (God forbid) sending (currently unprofitable) production overseas where it can be done profitably. And sometimes it means taking it through bankruptcy to shed unsustainable contracts (including with unions) but the idea that they would (or even could) do this by choice with a perfectly healthy company shows a complete misunderstanding of bankruptcy law. And yes, they will strip out some of the assets and sell them to mitigate their downside risk. This is free market capitalism. The money they made by restructuring these businesses was freed up to be invested in new ideas that created jobs in a more profitable market. America's economy is (or at least was) the most vibrant in the world precisely because of these kinds of activities.

It's vulture capitalism...and the ethics are a bit squirrely.

KayBee did not need restructuring. Bain stole pensions, then had the country bail them out. Plain and simple. It's not the type of business experience that will help the United States.

 

[OldGaffer]

How many jobs did stashing millions in Swiss and Cayman Island banks create?

 

[Lukey]

How many jobs did stashing millions in Swiss and Cayman Island banks create?

How much bad anti-capitalist (progressive) economic policy did it take to make that more attractive than investing in America?

 

[Lukey]

It's vulture capitalism...and the ethics are a bit squirrely.

KayBee did not need restructuring. Bain stole pensions, then had the country bail them out. Plain and simple. It's not the type of business experience that will help the United States.

It didn't? I shopped in their stores when my son was little. Mostly junk and too small to have much selection. Target and Walmart were both eating their lunch. Bain liquidated them and used the money on more profitable endeavors. The idea that KB Toys would still be here if not for Bain is absurd. It was an old company that had too much legacy costs and failed to adapt to competitive pressures. That money is doing way more good for the American economy where it is now than if it was still stuck in a limping along, failed business model.

 

[Craig]

It didn't? I shopped in their stores when my son was little. Mostly junk and too small to have much selection. Target and Walmart were both eating their lunch. Bain liquidated them and used the money on more profitable endeavors. The idea that KB Toys would still be here if not for Bain is absurd. It was an old company that had too much legacy costs and failed to adapt to competitive pressures. That money is doing way more good for the American economy where it is now than if it was still stuck in a limping along, failed business model.

\

No, they didn't. They had just restructured...and Bain stole their pensions. You then, had to bail out the pension plan.




http://www.fundinguniverse.com/company-histories/KB-Toys-Company-History.html

In 1999, KBkids.com received top points from an e-commerce market research firm, the Gomez Advisors, in the categories of customer confidence, overall cost, and bargain shopping. Softletter named the site one of the 'Ten Best Online Software Stores of 1999' in its October 15th issue. Even the Wall Street Journal dubbed the site the 'best overall' online toy retailer. In a little more than four months online, KBkids.com increased its business more than 400 percent and twice ranked among the five biggest gainers on the NextCard eCommerce Movers index.


It seemed nothing could stop KB Toys from challenging its rivals in the toy industry. Operating profit for 1999 was up 51 percent from 1998. The company, seeking to capitalize on its growth, decided to hold an initial public offering in the spring of 2000, then postponed trading due to unfavorable market conditions. Notwithstanding this delay, KB was more focused than ever on fine-tuning its position in the very fashion-forward toy industry. With relatively small stores and a knack for innovation and creativity in marketing, KB was ready as ever to make quick adjustments to changing customer and merchandise trends.




2. KB Toys was a company that made money and exercised social responsibility

After a 13 year old boy in NYC was shot and killed while holding a realistic toy gun (not from KB Toys) KB Toys destroyed 300,000 toys in inventory and never again carried realistic toy guns. They also gave toys for guns.

The company also participated in New York's 'Goods for Guns' program, which offered gift certificates to people who surrendered real firearms. Although Ann Iverson left as chairman in 1994, her policy of not selling look-alike guns was continued by her successor, Alan Fine, who had been senior vice-president before becoming president and CEO.



3. Bain Capital 'purchased' KB for the respectable price of $ 305 million dollars on December 8, 2000.

http://en.wikipedia.org/wiki/KB_Toys

4. Bain Capital only offered $ 18 million in cash, the rest was leaveraged debt put on the company.

5. "Sixteen months after the buyout, Bain Capital paid itself $85 million in dividends in early 2002."

6. "January 14, 2004, K·B Toys filed for Chapter 11 bankruptcy protection and closed 365 stores."

7. Three years later the rest of the 156 stores were closed down.

But there is a little more to the story. KB Stores had already gone through a tough restructuring in 1996. At that time a private equity bought the company, closed unprofitable stores, and increased profits.

So here is the objective reality of what Bain did.

Bain engineered a private equity purchase of a profitable company that had already gone through 'creative destruction' eliminating unprofitable legacy operations and saddled the company with hundreds of millions of dollars of debt. The company was not just profitable but an example of the kind of companies that demonstrate a wider social conscious for its customers and the larger community. Sixteen months after purchasing the company with only 6% cash of the value Bain takes out dividends at over 400% of their investment. Significantly this was done during the time of the attacks on 9/11 when the country as a whole was undergoing a hightened sense of patriotism, sacrifice and social duty. Less than 2 years after saddling KB Toys with massive debt and taking out astronomical dividends, K-B Toys faces Chapter 11 bankruptcy and closes 354 previously profitable stores.

Vultures take meat that is already dead and complete the final loop in the cycle of life.

Bain took a company that had already been restructured and was surging in profits and cash. There was never any interest by Bain to restructure KB Toys, that had already been done.

Bain purchased KB Toys simply to raid its cash, and they did so during a time when the rest of the country was undergoing a period of reviewing the founding principles of the country.

To call what Bain did to KB Toys as 'Vulture' Capitalism is an insult to Vultures.

They were pirates and this is why there is so much interest to change the subject and not let the real facts of Bain Capital come to the surface during the Republican Primary.

 

[OldGaffer]

\

No, they didn't. They had just restructured...and Bain stole their pensions. You then, had to bail out the pension plan.



http://www.fundinguniverse.com/company-histories/KB-Toys-Company-History.html

In 1999, KBkids.com received top points from an e-commerce market research firm, the Gomez Advisors, in the categories of customer confidence, overall cost, and bargain shopping. Softletter named the site one of the 'Ten Best Online Software Stores of 1999' in its October 15th issue. Even the Wall Street Journal dubbed the site the 'best overall' online toy retailer. In a little more than four months online, KBkids.com increased its business more than 400 percent and twice ranked among the five biggest gainers on the NextCard eCommerce Movers index.


It seemed nothing could stop KB Toys from challenging its rivals in the toy industry. Operating profit for 1999 was up 51 percent from 1998. The company, seeking to capitalize on its growth, decided to hold an initial public offering in the spring of 2000, then postponed trading due to unfavorable market conditions. Notwithstanding this delay, KB was more focused than ever on fine-tuning its position in the very fashion-forward toy industry. With relatively small stores and a knack for innovation and creativity in marketing, KB was ready as ever to make quick adjustments to changing customer and merchandise trends.




2. KB Toys was a company that made money and exercised social responsibility

After a 13 year old boy in NYC was shot and killed while holding a realistic toy gun (not from KB Toys) KB Toys destroyed 300,000 toys in inventory and never again carried realistic toy guns. They also gave toys for guns.

The company also participated in New York's 'Goods for Guns' program, which offered gift certificates to people who surrendered real firearms. Although Ann Iverson left as chairman in 1994, her policy of not selling look-alike guns was continued by her successor, Alan Fine, who had been senior vice-president before becoming president and CEO.



3. Bain Capital 'purchased' KB for the respectable price of $ 305 million dollars on December 8, 2000.

http://en.wikipedia.org/wiki/KB_Toys

4. Bain Capital only offered $ 18 million in cash, the rest was leaveraged debt put on the company.

5. "Sixteen months after the buyout, Bain Capital paid itself $85 million in dividends in early 2002."

6. "January 14, 2004, K·B Toys filed for Chapter 11 bankruptcy protection and closed 365 stores."

7. Three years later the rest of the 156 stores were closed down.

But there is a little more to the story. KB Stores had already gone through a tough restructuring in 1996. At that time a private equity bought the company, closed unprofitable stores, and increased profits.

So here is the objective reality of what Bain did.

Bain engineered a private equity purchase of a profitable company that had already gone through 'creative destruction' eliminating unprofitable legacy operations and saddled the company with hundreds of millions of dollars of debt. The company was not just profitable but an example of the kind of companies that demonstrate a wider social conscious for its customers and the larger community. Sixteen months after purchasing the company with only 6% cash of the value Bain takes out dividends at over 400% of their investment. Significantly this was done during the time of the attacks on 9/11 when the country as a whole was undergoing a hightened sense of patriotism, sacrifice and social duty. Less than 2 years after saddling KB Toys with massive debt and taking out astronomical dividends, K-B Toys faces Chapter 11 bankruptcy and closes 354 previously profitable stores.

Vultures take meat that is already dead and complete the final loop in the cycle of life.

Bain took a company that had already been restructured and was surging in profits and cash. There was never any interest by Bain to restructure KB Toys, that had already been done.

Bain purchased KB Toys simply to raid its cash, and they did so during a time when the rest of the country was undergoing a period of reviewing the founding principles of the country.

To call what Bain did to KB Toys as 'Vulture' Capitalism is an insult to Vultures.

They were pirates and this is why there is so much interest to change the subject and not let the real facts of Bain Capital come to the surface during the Republican Primary.

As far as Lukey is concerned, all of the above is good capitalism, morality has no place in capitalism, it is strictly profit and loss

 

[Lukey]

\

No, they didn't. They had just restructured...and Bain stole their pensions. You then, had to bail out the pension plan.




http://www.fundinguniverse.com/company-histories/KB-Toys-Company-History.html

In 1999, KBkids.com received top points from an e-commerce market research firm, the Gomez Advisors, in the categories of customer confidence, overall cost, and bargain shopping. Softletter named the site one of the 'Ten Best Online Software Stores of 1999' in its October 15th issue. Even the Wall Street Journal dubbed the site the 'best overall' online toy retailer. In a little more than four months online, KBkids.com increased its business more than 400 percent and twice ranked among the five biggest gainers on the NextCard eCommerce Movers index.


It seemed nothing could stop KB Toys from challenging its rivals in the toy industry. Operating profit for 1999 was up 51 percent from 1998. The company, seeking to capitalize on its growth, decided to hold an initial public offering in the spring of 2000, then postponed trading due to unfavorable market conditions. Notwithstanding this delay, KB was more focused than ever on fine-tuning its position in the very fashion-forward toy industry. With relatively small stores and a knack for innovation and creativity in marketing, KB was ready as ever to make quick adjustments to changing customer and merchandise trends.




2. KB Toys was a company that made money and exercised social responsibility

After a 13 year old boy in NYC was shot and killed while holding a realistic toy gun (not from KB Toys) KB Toys destroyed 300,000 toys in inventory and never again carried realistic toy guns. They also gave toys for guns.

The company also participated in New York's 'Goods for Guns' program, which offered gift certificates to people who surrendered real firearms. Although Ann Iverson left as chairman in 1994, her policy of not selling look-alike guns was continued by her successor, Alan Fine, who had been senior vice-president before becoming president and CEO.



3. Bain Capital 'purchased' KB for the respectable price of $ 305 million dollars on December 8, 2000.

http://en.wikipedia.org/wiki/KB_Toys

4. Bain Capital only offered $ 18 million in cash, the rest was leaveraged debt put on the company.

5. "Sixteen months after the buyout, Bain Capital paid itself $85 million in dividends in early 2002."

6. "January 14, 2004, K·B Toys filed for Chapter 11 bankruptcy protection and closed 365 stores."

7. Three years later the rest of the 156 stores were closed down.

But there is a little more to the story. KB Stores had already gone through a tough restructuring in 1996. At that time a private equity bought the company, closed unprofitable stores, and increased profits.

So here is the objective reality of what Bain did.

Bain engineered a private equity purchase of a profitable company that had already gone through 'creative destruction' eliminating unprofitable legacy operations and saddled the company with hundreds of millions of dollars of debt. The company was not just profitable but an example of the kind of companies that demonstrate a wider social conscious for its customers and the larger community. Sixteen months after purchasing the company with only 6% cash of the value Bain takes out dividends at over 400% of their investment. Significantly this was done during the time of the attacks on 9/11 when the country as a whole was undergoing a hightened sense of patriotism, sacrifice and social duty. Less than 2 years after saddling KB Toys with massive debt and taking out astronomical dividends, K-B Toys faces Chapter 11 bankruptcy and closes 354 previously profitable stores.

Vultures take meat that is already dead and complete the final loop in the cycle of life.

Bain took a company that had already been restructured and was surging in profits and cash. There was never any interest by Bain to restructure KB Toys, that had already been done.

Bain purchased KB Toys simply to raid its cash, and they did so during a time when the rest of the country was undergoing a period of reviewing the founding principles of the country.

To call what Bain did to KB Toys as 'Vulture' Capitalism is an insult to Vultures.

They were pirates and this is why there is so much interest to change the subject and not let the real facts of Bain Capital come to the surface during the Republican Primary.

It's just not rational to believe that KB was an immensely profitable and viable company that suddenly had to be sold via a leveraged buyout. If the business model was so wonderful, there would have been a bidding war and a cash deal. The stores were going under and everybody knew it. Their web site was the only (long term) viable asset and it was sold to Toy's R Us. Bain saw the writing on the wall and got the $85 million out before it was pissed away in the bankruptcy. It was then in all likelihood used to fund another VIABLE business endeavor. Those stores didn't close because of the $85 million capital withdrawal.

 

[Craig]

It's just not rational to believe that KB was an immensely profitable and viable company that suddenly had to be sold via a leveraged buyout. If the business model was so wonderful, there would have been a bidding war and a cash deal. The stores were going under and everybody knew it. Their web site was the only (long term) viable asset and it was sold to Toy's R Us. Bain saw the writing on the wall and got the $85 million out before it was pissed away in the bankruptcy. It was then in all likelihood used to fund another VIABLE business endeavor. Those stores didn't close because of the $85 million capital withdrawal.

It's not rational to ignore the facts. You made an assertion; I showed that assertion to be incorrect. Now you're simply making more assertions. It's really quite simple...you're an apologist that simply must find whatever spin you can to support your assertions...as you present no facts...or information in the slightest to support your assertions.

Ho hum..

 

[Spamature]

An anti-capitalist hit piece from a decidedly progressive economic research outfit. I hope you aren't suggesting this is an unbiased report!!!

Are their examples of "vulture capitalism" where private equity buys a stumbling business and strips it of its assets before it goes under? Sure, but as Conneib points out above, the owners who let the business get into that precarious state are the ones who should receive your criticism. The idea that private equity outfits buy perfectly healthy companies and destroy them in an effort to squeeze out a quick profit is absurd. If the company is healthy, the owners either keep it or sell out to another company or private owner to operate. Private equity only gets a shot at wounded businesses. They need restructured in order to survive. Sometimes that means laying off unneeded staff or closing unprofitable plants or (God forbid) sending (currently unprofitable) production overseas where it can be done profitably. And sometimes it means taking it through bankruptcy to shed unsustainable contracts (including with unions) but the idea that they would (or even could) do this by choice with a perfectly healthy company shows a complete misunderstanding of bankruptcy law. And yes, they will strip out some of the assets and sell them to mitigate their downside risk. This is free market capitalism. The money they made by restructuring these businesses was freed up to be invested in new ideas that created jobs in a more profitable market. America's economy is (or at least was) the most vibrant in the world precisely because of these kinds of activities.

And how is this ANY DIFFERENT than what the mob does ?

 

[Woolleybugger]

In other words, you love fleecing businesses to enrich the few. This is what has been called many things in the past including a protection racket. In this case, the skim is taken first, the debt is piled on high and the ones who take it in the chin are the marks like employees, banks, investors and communities. The gangster then goes on to another firm and does it all over again adding absolutely nothing of value and sharing in none of the pain. Its a perfect racket and guess what? It's legal.

 

[Spamature]

In other words, you love fleecing businesses to enrich the few. This is what has been called many things in the past including a protection racket. In this case, the skim is taken first, the debt is piled on high and the ones who take it in the chin are the marks like employees, banks, investors and communities. The gangster then goes on to another firm and does it all over again adding absolutely nothing of value and sharing in none of the pain. Its a perfect racket and guess what? It's legal.

Because its all an illusion.

Almost every crime you can think of is allowed by law to be carried out by a specific group of people who if they were not among a that group would face prosecution for doing virtually the same thing.

The Paulies end up with a prison sentence for racketeering.
The Mitts end up with the GOP nomination for the White House

 

[Spamature]

In a bad economy choose wisely. Businessman or community organizer.

Choose wisely indeed. I'm sure plenty of local merchants to their regret chose to seek the help of an...errr.... "Legitimate Businessman" and his "organization" rather than some community group when they we in trouble.

 

[middleview]

You guys chose a businessman in 2000.....how'd that work for the USA?

 

[middleview]

That is one way to deny that the information is accurate. In fact, Bain took over companies with borrowed money (all they needed to do was own more stock than anyone else) then work out a deal with the CEO to use assets of the company to get huge loans and then payout a dividend to stock holders. The result of that is that Bain has now already made a profit and that is without having actually done anything at all, but the company is very far in debt. The dividend served no purpose related to keeping the company afloat.

You think companies like Bain never put a healthy company into bankruptcy? Read "America, what went wrong?" by Bartlett and Steele....then get back to me.

 

[middleview]

More like how much republican legislation, bought and paid for by the wealthy contributors, brought about a legal means to avoid paying taxes?