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Debt, down market drove plane maker to bankruptcy
Economic turbulence has shrunk the market for business jets, and it's causing an especially bumpy ride for Hawker Beechcraft.
The Wichita, Kan.-based aircraft maker filed for bankruptcy protection this week, seeking approval for a plan that would write an estimated $2.5 billion in debt off its books and eliminate almost $125 million in annual cash interest expenses.
Source: BusinessWeek
GOP blasts Obama for 'punting' on debt
The Republicans promoted tax reform on Saturday, while assailing President Obama over the growing federal debt that is heading toward $16 trillion.
"The president punts on almost every tough decision," said Sen. Bob Corker, R-Tenn., in the weekly Republican radio address.
"In fact," Corker said of Obama, "as he appeals to college students, his administration is robbing those same young people of their American inheritance, spending their money on my generation and engaging in nothing short of generational theft."
Source: USA TODAY
Ten Reasons Wall Street Should Be (Very) Worried About The US Debt
This is a guest post by Michael Cembalest, Chairman of Market and Investment Strategy for J.P. Morgan Asset Management. You can read the entire report as a PDF here .
In August 2011, the United States lost one of its AAA credit ratings, a designation first bestowed around 100 years ago, which when combined with the debt ceiling debate, created one of the sharpest market corrections in post-war US history. Financial markets remain concerned about the ability and willingness of the US and Europe to tackle their respective fiscal challenges. With US federal debt approaching its highest level since the formation of the federal government in 1789 (other than during WWII and its immediate aftermath), rating agencies are taking a close look at rising US debt and what the legislature does to contain it. The appetite of foreign central banks to accumulate Treasuries has provided the US with a reprieve; these entities, plus Federal Reserve holdings, now account for half of all Treasury bonds. But monetary policy in Asia and the Middle East is subject to change, and we have seen in Europe the suddenness with which sovereign debt can be re-priced by financial markets. Downgrades, government shutdown rumors and political impasse on deficit reduction have not lost their ability to negatively affect equity markets, business activity and confidence. This note details 10 reasons why we believe financial markets will take a close look at what Congress does in the year ahead.
Source: Forbes