I am writing today to announce the closure of the Michigan Messenger. After four years of operation in Michigan, the board of the American Independent News Network, has decided to shift publication of its news into a single site, The American Independent at Americanindependent.com. This is part of a shift in strategy, towards new forms [...]
An abstinence-only presentation provided to numerous school districts in Calhoun and Eaton Counties in October of this year provided false and misleading information to students about HIV, experts allege.
Two county registers of deeds filed a class action lawsuit Monday on behalf of Michigan’s 83 counties alleging that the Mortgage Electronic Registration Services owes millions of dollars in property title transfer taxes.
Despite evidence of the impact of mercury on children and public health, Michigan Attorney General Bill Schuette last month joined with 24 other state attorneys general in filing a lawsuit to scuttle new EPA regulations that would reduce mercury emissions from power plants.
The Detroit Free Press manages to find the cloud in the silver lining of Ford’s astonishing announcement of a $2.1 billion profit yesterday, and it’s the same cloud we identified nearly a year ago when Ford’s competitors were going through bankruptcy: Too much debt.
In April, Ford paid $3 billion of its debt ahead of schedule, but it still finished the quarter with $34.3 billion in debt — nearly twice the $17 billion in debt that General Motors had as it left bankruptcy last year.
It’s an expensive debt to carry: In 2009, Ford paid $1.5 billion in interest on it — and it also diverts Ford’s resources from other areas, such as product development.
Much of Ford’s debt is from a $23.5-billion loan the company took out in 2006. Ford President and CEO Alan Mulally often jokingly refers it as a “home-improvement loan.”
That loan is what allowed Ford to stay liquid during last year’s disastrous plunge in sales and avoid bankruptcy court, but while GM and Chrysler managed to shed most of their debt last year in bankruptcy, Ford is still stuck with paying back that loan. And in 2011, it begins to come due.
Ford is right that the best way to pay off that debt is to continue to have strong sales and increase their market share, and they’re off to a great start at doing that. They’re certainly in a far stronger position today than we would have thought last summer, but it still may not be enough for them to make the required payments on the debt.
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