Shares of junk companies such as American Airlines (AAL) and General Electric (GE) are back where they traded during the COVID doldrums.
What was gained by bailing out these shit companies or the thousands of zombie companies that received COVID relief money? All of that wasted capital – trillions of dollars – that was printed out of thin air (it’s not as though the U.S. is sitting on a net cash position), and for what? The CPI stands where it does as a result of the trillions in excess liquidity that went to non-productive means. Meanwhile, AAL spent $807 million on airport construction projects during the March quarter. With a long-term debt position of $36 billion and a looming recession, how much longer before AAL’s management team looks to the Federal Government for another bailout? Time to allow the weak to fail.