DCist: Metro to Belgium: How 'Bout Cutting Us Some Friggin' Slack?

ledroitist

Sat, 01 Nov 2008 13:16:40 -0500

Well, to quote Calvin Coolidge (perhaps apocryphally), "They hired the money, didn't they?" It seems like "greedy" sub-prime homeowners aren't the only one being caught with their pants down once the magic finance carousel stopped spinning and the bills came due. Metro signed this too-slick-for-words deal, and to the extend KBC is enforcing the terms of the contract, well, that's their prerogative.

Krisa

Sat, 01 Nov 2008 11:51:12 -0500

If banks are able to make a profit from leasing these vehicles, then wouldn't it make more financial sense for metro to own its own vehicles? I know I don't understand all the details, but I draw a parallel to everyone's decision of lease vs. buy. Usually it's based on cash on hand rather than which one is better terms. So maybe it's a symptom of metro's funding streams, but metro's not going anywhere anytime soon.. it should own its own infrastructure. Can purchases of cars be financed some other way?

jakers

Sat, 01 Nov 2008 08:33:49 -0500

Did WMATA at least get some collateral on its insurance from AIG? The city should have a claim to a few cash-worthy planks from that sinking ship. (Way well done video explaining this kind of credit default swap: http://www.publicradio.org/columns/marketplace/offair/2008/10/untangling_credit_default_swap.html ).

districtdon19

Fri, 31 Oct 2008 14:39:35 -0500

Hehe sounds like a breakfast of champions. I don't mean to be such a stickler. I'm glad you keep up with the comment board on your pieces. Earlier this week, I had to email Ben at Consumerist for conveying in a piece he wrote -- regarding outsourced Chase Bank call centers -- about the people of the Philippines (where I'm from) as Phillipinians instead of the correct form: Filipino. He fixed it in very short order (but didn't email me back anything *sad face*). Consumerist for cryin' out loud! But, your typo was just teehee funny.

Aaron Morrissey

Fri, 31 Oct 2008 14:32:20 -0500

Thanks, districtdon. The "r" was unfortunately consumed with this morning's breakfast of Almond Joys and Dubble Bubble.

districtdon19

Fri, 31 Oct 2008 14:22:38 -0500

cumbling platforms

Deep

Fri, 31 Oct 2008 13:23:34 -0500

How Waffle!

arglebargle

Fri, 31 Oct 2008 13:18:54 -0500

So now we know what the bag searches are really about. The police will be swiping any spare change from the bottom of your bag, as a way to raise the $43 million!

monkeyrotica

Fri, 31 Oct 2008 13:02:43 -0500

We ran the Belgians out of Swampoodle in 'Ought Six. We can do it again.

cactus jack

Fri, 31 Oct 2008 12:53:04 -0500

This is interesting, at least for deal nerds. Apparently, the transaction is structured as a sale-leaseback rather than a loan. When the transaction was consummated, this structure created tax benefits for the bank. And then the tax code changed. As part of the changes, sale-leaseback tax benefits were eliminated. The loss of the tax benefits means that sale-leaseback structure is no longer advantageous for banks and they're generally looking to get out. It seems to be a problem for transit agencies generally. It'd be fun to read WMATA's transaction dox to see what the insurance provision actually requires. And to see what other technical defaults are possible. Even if WMATA cures the insurance default, the bank will be looking for outs left and right.

volite

Fri, 31 Oct 2008 12:51:59 -0500

WMATA should just up the fares to cover the cost of repayment. $390.00 will get you from Union Station to Judiciary Square...

Deep

Fri, 31 Oct 2008 12:38:49 -0500

Where's Belgium? Virginia or Maryland?

Rukasu

Fri, 31 Oct 2008 12:31:39 -0500

Belgium is so on the verge of ethnic civil war, just wait

monkeyrotica

Fri, 31 Oct 2008 12:27:48 -0500

How far can these Sprouts push us? When are we going to tell the Phlegms, "Enough is enough?" We're tired of your unreasonable banking demands and your lambic ales and your mussels in white wine and your caving-in to German blitzkriegs. The choice, she's a clear un: either you're in favor of supporting mass transit, or you're in favor of road signs being in both German and French.

Reid

Fri, 31 Oct 2008 12:27:40 -0500

Von Schliefflen is finally vindicated!

Rukasu

Fri, 31 Oct 2008 12:20:23 -0500

@ Kevrock: Tintin comment FTW! I propose going to Granville Moore's and demanding "Freedom Frites" and pouring their $11 beers out onto H St.

monkeyrotica

Fri, 31 Oct 2008 11:47:51 -0500

I'm going to protest by drowning the Belgian Embassy in Admiration mayonnaise.

IMGoph

Fri, 31 Oct 2008 11:43:03 -0500

john kelly advocates invading belgium over this: here and here.

monkeyrotica

Fri, 31 Oct 2008 11:42:56 -0500

This has nothing to do with transit-friendly Belgium and everything to do with the imploding housing/banking confidence game. KBC is as much up to its ass in the credit default swap latrine trench as AIG, Lehman Brothers, and Credit Suisse. So they're scrambling to find any cash they can to stay afloat. In the end, they'll probably end up with a chunk of that $700 billion bailout, seeing as most of the Wall Street banks being bailed out are inevitably tied to multinationals. So KBC'll get paid twice for f**king their financials into the dirt and WMATA will have to resort to using CHUDs in harnesses to pull their trains because they can't pay their electric bill. God bless America and Merry F**king Xmas.

Kevrock

Fri, 31 Oct 2008 11:41:17 -0500

Maybe they figured they'd already done enough for us by giving us mussels, fries, lambic, waffles, and Tintin?