Another Bankruptcy For Hostess

Hostess returns to bankruptcy over pensions

(Reuters) - Twinkies and Wonder Bread maker Hostess Brands Inc filed for bankruptcy protection for the second time in less than three years, after failing to reach an agreement with workers on pension and health benefits.
Hostess' declining financial performance, crippling legacy costs associated with its pension plans and massive debt levels led the company to Chapter 11 bankruptcy, court papers showed on Wednesday.
The company, which has about $860 million in debt, said it does not expect disruptions in the manufacturing and delivery of its products during the bankruptcy process.
To reorganize itself, the company must withdraw from multiemployer pension plans, address legacy health and welfare costs and secure new capital to modernize its production and distribution operations, Irving, Texas-based Hostess said.
The company had total assets of $981.6 million and liabilities of $1.43 billion as of December 10, 2011.

Hostess, formerly known as Interstate Bakeries Corp, had first filed for bankruptcy protection in 2004 in Missouri and emerged from it in February 2009 with private equity firm Ripplewood Holdings and other lenders taking control.

My view:

A trend is developing in corporate America.

Declare bankruptcy to shed pension benefits and heath costs.

This is likely to reinforce a deflationary trend as workers must work longer and save more before retirement.

Forget "freedom 55", now it's "freedom 75".

Comments

  1. Gold and Silver my friend they are printing money like madmen. Not sure about the mining shares though..I have played them but the manipulation in these markets is oblivious and blatant. Physical only for me I have pretty much given up on US markets as a whole.

    http://truthingold.blogspot.com/2012/01/debt-limit-ceiling-and-insanity.html#comment-form

    ReplyDelete
  2. I am afraid you are 100% correct Bill. Gold and silver are the only viable currencies at this point. The ECB and Federal Reserve and Bank of Canada, England, Australia, ... has proven that they are deranged currency debasers. I too am depending on the physical market much more than the miners, but do hold some miners for diversification.
    It is my view that 2012 will be a pivotal year in this monetary crisis.

    ReplyDelete
  3. Agreed. I will admit I do own a few Call options in Both GDX and GDXJ, But the majority is physical.

    Establishment Pundit Left Speechless by Ron Paul Smackdown

    http://www.youtube.com/watch?v=15mBXCMvAuA&feature=player_embedded

    Good to see Paul fighting back, wake up America your days are numbered...

    Be well

    ReplyDelete
  4. My Quaker they are printing amphetamine like madmen. Not sure about the quarrying portion though..I have played them but the manipulation in these markets is oblivious and blatant. Physical only for me I have pretty scads given up on US markets as a whole.

    ReplyDelete
  5. Gold and Silver my fan they are printing amphetamine like madmen. Not sure about the mining shares though..I have played them but the manipulation in these markets is oblivious and blatant. Physical only for me I have pretty much given up on US markets as a whole.

    ReplyDelete

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