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No kidding Zander, they are really resorting to poor logic, especially on this issue.
More from the link!
And like other great presidential double-talkers such as Bill Clinton and George W. Bush, Romney has shown particular aptitude in the area of telling multiple factual versions of his own life story. "I longed in many respects to actually be in Vietnam and be representing our country there," he claimed years after the war. To a different audience, he said, "I was not planning on signing up for the military. It was not my desire to go off and serve in Vietnam."
Romney and Bain avoided the hostile approach, preferring to secure the cooperation of their takeover targets by buying off a company's management with lucrative bonuses. Once management is on board, the rest is just math. So if the target company is worth $500 million, Bain might put down $20 million of its own cash, then borrow $350 million from an investment bank to take over a controlling stake
But here's the catch. When Bain borrows all of that money from the bank, it's the target company that ends up on the hook for all of the debt. Now your troubled firm let's say you make tricycles in Alabama has been taken over by a bunch of slick Wall Street dudes who kicked in as little as five percent as a down payment. So in addition to whatever problems you had before, Tricycle Inc. now owes Goldman or Citigroup $350 million. With all that new debt service to pay, the company's bottom line is suddenly untenable: You almost have to start firing people immediately just to get your costs down to a manageable level...
What a guy!
The incredible untold story of the 2012 election so far is that Romney's run has been a shimmering pearl of perfect political hypocrisy, which he's somehow managed to keep hidden, even with thousands of cameras following his every move. And the drama of this rhetorical high-wire act was ratcheted up even further when Romney chose his running mate, Rep. Paul Ryan of Wisconsin like himself, a self-righteously anal, thin-lipped, Whitest Kids U Know penny pincher who'd be honored to tell Oliver Twist there's no more soup left. By selecting Ryan, Romney, the hard-charging, chameleonic champion of a disgraced-yet-defiant Wall Street, officially succeeded in moving the battle lines in the 2012 presidential race.
Read more: Greed and Debt: The True Story of Mitt Romney and Bain Capital | Politics News | Rolling Stone
They had nice things to say about Reagan and Bush too.
People still read that left-winged bird cage liner?
So in other words, they are absolutely lying and thats why you like the article.
Please point out what they got wrong in the article.
I'm still reading it, but it's really kind of the stuff that people who actually studied Bain have known for years.
Here's a revealing comment from your article that demonstrates the mentality of the author:
But the way Romney most directly owes his success to the government is through the structure of the tax code. The entire business of leveraged buyouts wouldn't be possible without a provision in the federal code that allows companies like Bain to deduct the interest on the debt they use to acquire and loot their targets. This is the same universally beloved tax deduction you can use to write off your mortgage interest payments, so tampering with it is considered political suicide
In the first place, it's not the same thing as your mortgage interest deduction. Your mortgage is a personal expense, not a business expense.
So the author apparently believes that businesses should not be allowed to deduct legitimate business expenses from their gross revenue. If deducting interest expenses is a scam, then how about employee benefits? How is that any more legitimate? How about rent on their office space? How about the electric bill? This moron doesn't seem to understand that when you put gas in your personal car, it's a personal expense, but when you put gas in a company vehicle, then it's a business expense.
This guy is obviously a Marxist moron who doesn't know the slightest thing about economics or the slightest thing about tax law. Given the ignorance he displays here, why should anyone take anything he says about Mitt Romney and Bain Capital seriously?
It's obvious that you're also an ignoramus since you find this brand of Marxist swill so convincing.
So you think that Bain Capital should have borrowed the money and then made a gift of it to the company without expecting anything in return? Why shouldn't the company be on the hook for the money if it's all used to pay Company expenses?
What this article shows is that the author is a moron. You're also a moron.
More from the link!
And like other great presidential double-talkers such as Bill Clinton and George W. Bush, Romney has shown particular aptitude in the area of telling multiple factual versions of his own life story. "I longed in many respects to actually be in Vietnam and be representing our country there," he claimed years after the war. To a different audience, he said, "I was not planning on signing up for the military. It was not my desire to go off and serve in Vietnam."
Romney and Bain avoided the hostile approach, preferring to secure the cooperation of their takeover targets by buying off a company's management with lucrative bonuses. Once management is on board, the rest is just math. So if the target company is worth $500 million, Bain might put down $20 million of its own cash, then borrow $350 million from an investment bank to take over a controlling stake
But here's the catch. When Bain borrows all of that money from the bank, it's the target company that ends up on the hook for all of the debt. Now your troubled firm let's say you make tricycles in Alabama has been taken over by a bunch of slick Wall Street dudes who kicked in as little as five percent as a down payment. So in addition to whatever problems you had before, Tricycle Inc. now owes Goldman or Citigroup $350 million. With all that new debt service to pay, the company's bottom line is suddenly untenable: You almost have to start firing people immediately just to get your costs down to a manageable level...
What a guy!
So in other words, they are absolutely lying and thats why you like the article.
Please point out what they got wrong in the article.
I'm still reading it, but it's really kind of the stuff that people who actually studied Bain have known for years.
Here's a revealing comment from your article that demonstrates the mentality of the author:
But the way Romney most directly owes his success to the government is through the structure of the tax code. The entire business of leveraged buyouts wouldn't be possible without a provision in the federal code that allows companies like Bain to deduct the interest on the debt they use to acquire and loot their targets. This is the same universally beloved tax deduction you can use to write off your mortgage interest payments, so tampering with it is considered political suicide
In the first place, it's not the same thing as your mortgage interest deduction. Your mortgage is a personal expense, not a business expense.
So the author apparently believes that businesses should not be allowed to deduct legitimate business expenses from their gross revenue. If deducting interest expenses is a scam, then how about employee benefits? How is that any more legitimate? How about rent on their office space? How about the electric bill? This moron doesn't seem to understand that when you put gas in your personal car, it's a personal expense, but when you put gas in a company vehicle, then it's a business expense.
This guy is obviously a Marxist moron who doesn't know the slightest thing about economics or the slightest thing about tax law. Given the ignorance he displays here, why should anyone take anything he says about Mitt Romney and Bain Capital seriously?
It's obvious that you're also an ignoramus since you find this brand of Marxist swill so convincing.
The point is, that they weren't borrowing money to improve the business.
If they were borrowing money to buy new equipment, improve processes, streamline production, yeah, absolutely, they have to make that money up somewhere.
If they were borrowing money to pay themselves big bonuses and management fees, and the only way to make the payments was to start firing people, which often made the companies less productive and caused them to flounder, that was wrong.
But it's something our system allows.
So you think that Bain Capital should have borrowed the money and then made a gift of it to the company without expecting anything in return? Why shouldn't the company be on the hook for the money if it's all used to pay Company expenses?
What this article shows is that the author is a moron. You're also a moron.
More from the link!
What a guy!
Please point out what they got wrong in the article.
I'm still reading it, but it's really kind of the stuff that people who actually studied Bain have known for years.
Here's a revealing comment from your article that demonstrates the mentality of the author:
But the way Romney most directly owes his success to the government is through the structure of the tax code. The entire business of leveraged buyouts wouldn't be possible without a provision in the federal code that allows companies like Bain to deduct the interest on the debt they use to acquire and loot their targets. This is the same universally beloved tax deduction you can use to write off your mortgage interest payments, so tampering with it is considered political suicide
In the first place, it's not the same thing as your mortgage interest deduction. Your mortgage is a personal expense, not a business expense.
So the author apparently believes that businesses should not be allowed to deduct legitimate business expenses from their gross revenue. If deducting interest expenses is a scam, then how about employee benefits? How is that any more legitimate? How about rent on their office space? How about the electric bill? This moron doesn't seem to understand that when you put gas in your personal car, it's a personal expense, but when you put gas in a company vehicle, then it's a business expense.
This guy is obviously a Marxist moron who doesn't know the slightest thing about economics or the slightest thing about tax law. Given the ignorance he displays here, why should anyone take anything he says about Mitt Romney and Bain Capital seriously?
It's obvious that you're also an ignoramus since you find this brand of Marxist swill so convincing.
Well, no, not realy.
I used to own a rental property. Lived in one unit and rented out the other. I deducted half my mortgage on Schedule A and the other half on Schedule E.
The point that he made was that what Romney was not doing was "valid business expenses". It was using borrowed money to pay himself a big bonus, then declaring bankruptcy and enjoying legal protections. Yeah, these laws exist for valid reasons, but he was pretty clearly abusing them.
I'm always amused when people like you who aren't rich, who get burned by this system, get out there and defend it. You're like abused wives who keep going back to your abuser and saying it's your own fault.
Anyways, we've had this "Joe is a bigot" discussion many times.
Matt Taibbi is a lying douchebag who has an agenda. Read everything he writes with a huge grain of salt.
Anyways, we've had this "Joe is a bigot" discussion many times.
Matt Taibbi is a lying douchebag who has an agenda. Read everything he writes with a huge grain of salt.
because he doesnt agree with you hes lying?
this does not fly.
POINT out the lie if you want us to believe he lies.
there is NO reason for anyone to just take someone elses word that another is a liar.
Its a accusation YOU MUST PROVE
Anyways, we've had this "Joe is a bigot" discussion many times.
Matt Taibbi is a lying douchebag who has an agenda. Read everything he writes with a huge grain of salt.
because he doesnt agree with you hes lying?
this does not fly.
POINT out the lie if you want us to believe he lies.
there is NO reason for anyone to just take someone elses word that another is a liar.
Its a accusation YOU MUST PROVE
So you think that Bain Capital should have borrowed the money and then made a gift of it to the company without expecting anything in return? Why shouldn't the company be on the hook for the money if it's all used to pay Company expenses?
So you think that Bain Capital should have borrowed the money and then made a gift of it to the company without expecting anything in return? Why shouldn't the company be on the hook for the money if it's all used to pay Company expenses?
It isn't all used to pay company expenses, its used to buy the shares of the company from the current shareholders.
So you think that Bain Capital should have borrowed the money and then made a gift of it to the company without expecting anything in return? Why shouldn't the company be on the hook for the money if it's all used to pay Company expenses?
It isn't all used to pay company expenses, its used to buy the shares of the company from the current shareholders.
So you think that Bain Capital should have borrowed the money and then made a gift of it to the company without expecting anything in return? Why shouldn't the company be on the hook for the money if it's all used to pay Company expenses?
It isn't all used to pay company expenses, its used to buy the shares of the company from the current shareholders.
Investopedia explains 'Leveraged Buyout - LBO'
In an LBO, there is usually a ratio of 90% debt to 10% equity. Because of this high debt/equity ratio, the bonds usually are not investment grade and are referred to as junk bonds. Leveraged buyouts have had a notorious history, especially in the 1980s when several prominent buyouts led to the eventual bankruptcy of the acquired companies. This was mainly due to the fact that the leverage ratio was nearly 100% and the interest payments were so large that the company's operating cash flows were unable to meet the obligation.
One of the largest LBOs on record was the acquisition of HCA Inc. in 2006 by Kohlberg Kravis Roberts & Co. (KKR), Bain & Co., and Merrill Lynch. The three companies paid around $33 billion for the acquisition.
It can be considered ironic that a company's success (in the form of assets on the balance sheet) can be used against it as collateral by a hostile company that acquires it. For this reason, some regard LBOs as an especially ruthless, predatory tactic.
Read more: Leveraged Buyout (LBO) Definition | Investopedia
This is what I mean when I said Taibbi is just a lying, angry, douchebag hack. That "provision" in the tax code allows every single other business in America to write off interest expense. Oh, but it's bad when Wall Street does it.
BTW, you know who the biggest benefactor is when a company like Bain buys a business with debt? The owner of the business who just sold it. Had Bain not used debt, the owner would have received much less money.
Yes, in many cases they were borrowing to improve the business. But don't let that inconvenient fact get in the way of your hatefest!
