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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: elmatador who wrote (45074)	1/21/2004 9:57:41 PM
From: EL KABONG!!!	Read Replies (1) \| Respond to of 74559

Hi elmatador, I know of people that specialize in buying the debt of "distressed" companies. One of these guys had let it slip the other day that he knows of no one currently interested in buying any of Parmalat's debt (usually bought at pennies on the dollar, and then repaid with either cash flow or sold assets). His thoughts were that, at this early stage of the investigation and forensic accounting, no one had found any assets worth speaking of, other than the money-losing subsidiary businesses. And even those businesses are believed to have their own layers of debt. This Parmalat scandal is looking a whole lot worse than Enron and WorldCom. At least Enron and WorldCom still had sufficient assets to remain in business, albeit at the expense of shareholders, debtholders and current employees. The picture of Parmalat that is slowly emerging is that they don't have sufficient assets or monies for an eventual recovery, no how no way. And the banks aren't exactly lining up to extend Parmalat any credit while in bankruptcy. That in and of itself is a resounding vote of "no confidence". Where did the Parmalat cash go? The story I've heard is that they spent it all, on themselves, and quite lavishly to boot. Allegedly, they bled the golden goose of all her eggs until there was nothing left inside her... Time will tell I suppose... KJC