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View Diary: Sensata worker: Romney's job claims make him 'just a bold-faced liar' (77 comments)

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  •  The P&L Statement (0+ / 0-)

    Here's an example of how this could have transpired.  Bain looked at the P&L, looked at the labor costs, substituted what labor costs would be if the jobs were shipped to China, took the difference, extrapolated that out to five to ten years, compared the opportunity that cash flow represented to other targets available to them at the same time, and made an offer that they thought would net them the desired amount of return on their investment.  They may have also looked at the balance sheet, found a favorable asset to debt ratio, discussed the possible purchase with their bankers, and financed some portion, or even most, of the purchase with debt backed by the net asset ratio of the balance sheet.  Thus, with possibly little of their own money, they purchase the company, ship the jobs to China, pay interest on the additional debt from a portion of the labor savings, and the rest is pure profit.

    Love one another

    by davehouck on Tue Oct 16, 2012 at 10:44:55 AM PDT

    [ Parent ]

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