Economy
Related: About this forumSouth Korea’s Hanjin Shipping files for bankruptcy protection
South Koreas Hanjin Shipping Co. filed for receivership Wednesday, as shipping companies world-wide grapple with overcapacity amid a slump in global trade. It would become the biggest company in the industry to go under if it is ordered to fold.
The filing with the Seoul Central District Court came just a day after the companys creditors discontinued providing a lifeline after financial assistance of more than 1 trillion won ($896 million) failed to keep it afloat. The court will soon determine whether Hanjin, the countrys largest container operator by capacity and the eighth-largest in the world, should be liquidated or given a chance to survive after restructuring, the company said.
The companys main creditor, state-run Korea Development Bank, withdrew its support on Tuesday, saying a funding plan by Hanjins parent group wasnt sufficient to tackle the shippers debt, which stood at $5.5 billion at the end of June.
Hanjin a unit of the conglomerate that controls Korean Air Lines Co. has faced an acute credit crunch after posting a loss each year from 2011 to 2014, as slowing global trade and overcapacity depressed freight rates. It has been under a creditor-led debt restructuring program since May.
The Korean government said it wants Hanjins domestic rival, Hyundai Merchant Marine Co., to buy healthy assets from the troubled company. It rejected the idea of a merger.
At: http://www.wsj.com/articles/troubled-hanjin-shipping-to-sell-healthy-assets-to-rival-1472611190
elleng
(130,153 posts)Central Bankers Hear Plea: Turn Focus to Government Spending.
GRAND TETON NATIONAL PARK, Wyo. Central bankers who gathered here to discuss better ways of jump-starting slow economic growth received a surprising message from their lunchtime speaker on Friday: Stop. Youre making things worse.
Christopher A. Sims, a Nobel laureate in economic science, told the annual conference that increased government spending was required to lift the worlds major economies from stagnation. The pursuit of innovations in monetary policy, he said, is diverting needed attention from the inaction of fiscal policy makers.
http://www.democraticunderground.com/111678852
forest444
(5,902 posts)Excellent context. Thank you, elleng.
elleng
(130,153 posts)and unfortunately, tptb continually choose to ignore it.
http://www.democraticunderground.com/10028129443
forest444
(5,902 posts)Just tell voters that any government spending - except defense, of course - just goes to coddle lazy minorities on welfare. Works every time.
Now if they could remember were they put those $8 trillion in "missing" defense funds...
elleng
(130,153 posts)If you can convince the lowest white man he's better than the best colored man, he won't notice you're picking his pocket. Hell, give him somebody to look down on, and he'll empty his pockets for you.'
As quoted in "What a Real President Was Like: To Lyndon Johnson, the Great Society Meant Hope and Dignity", by Bill Moyers, The Washington Post (13 November 1988).
T_i_B
(14,734 posts)I hope that none of you have goods on a Hanjin vessel right now.
http://www.zerohedge.com/news/2016-08-31/global-supply-chains-paralyzed-after-worlds-7th-largest-container-shipper-files-bank
Making matters worse, Reuters adds that KDB's move to pull the plug was already having an impact on Hanjin's operations, with the company's various shipping assets already frozen. Ports including those in Shanghai and Xiamen in China, Valencia, Spain, and Savannah in the U.S. state of Georgia had blocked access to Hanjin ships on concerns they would not be able to pay fees, a company spokeswoman told Reuters.
Another vessel, the Hanjin Rome, was seized in Singapore late on Monday by a creditor, according to court information. "Now Hanjin must do everything it can to protect its clients' cargoes and make sure they are not delayed to their destination, by filing injunctions to block seizures in all the countries where its ships are located," said Bongiee Joh, managing director of the Korea Shipowners' Association.
The global implications from the bankruptcy are unknown: if, as expected, the company's ships remain "frozen" and inaccessible for weeks if not months, the impact on global supply chains will be devastating, potentially resulting in a cascading waterfall effect, whose impact on global economies could be severe as a result of the worldwide logistics chaos. The good news is that both economists and corporations around the globe, both those impacted and others, will now have yet another excuse on which to blame the "unexpected" slowdown in both profits and economic growth in the third quarter.
forest444
(5,902 posts)Ah, if wishes were horses.
T_i_B
(14,734 posts)Especially if it's going to be spending a lot of time on the water because no port will accept the vessel!
On a more gloomy note, this is really bad news for firms who need their freight urgently to keep production going or to meet deadlines. Although it's Hanjin's staff I feel most sorry for.
forest444
(5,902 posts)Do you get the same feeling?
T_i_B
(14,734 posts)Who aren't exactly in the best financial shape themselves.
forest444
(5,902 posts)Lately at least, Korea's corporatocracy is doing their country more harm than any number of Lil' Kim's dud rockets.
Qué será.
T_i_B
(14,734 posts)Korean or otherwise. Overcapacity due to ever bigger vessels appears to be the major issue. Too many new ships and not enough freight to ship on them.
forest444
(5,902 posts)Except at the top, of course.
T_i_B
(14,734 posts)I'm thinking of the actual sea freight business. People who work in the trade have more idea about what's going on then politicians do.
Eugene
(61,595 posts)Source: Reuters
Hanjin Shipping gets U.S. court order, cash to unload ships
By Tom Hals
A U.S. judge on Friday signed an order granting Hanjin Shipping Co Ltd (117930.KS) provisional protection from creditors in the United States, enabling some vessels to dock and unload at U.S. ports.
South Korea's Hanjin had asked U.S. Bankruptcy Judge John Sherwood to issue an order to prevent creditors from seizing Hanjin ships or property, and to allow cargo owners to make arrangements to retrieve goods stranded in warehouses.
Earlier, the company received authority to spend money needed to dock at U.S. ports and begin unloading four vessels that have been stranded at sea by the company's failure last week, a company lawyer told a U.S. court on Friday.
"We have the money," said Ilana Volkov, an attorney for Hanjin, told a U.S. Bankruptcy Court hearing in Newark, New Jersey on Friday. "We want to call these ports and say, please accept our ships and we want to pay for the services to work the ships.
Volkov said at least $10 million was authorized by a Korean court to begin servicing the four ships. Hanjin identified 14 U.S.-bound ships in court papers, but Volkov said she did not have information about the other vessels.
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Read more: http://www.reuters.com/article/us-hanjin-shipping-debt-usa-bankruptcy-idUSKCN11F2DV
T_i_B
(14,734 posts)...in order to get the Port of Felixstowe to release a Hanjin container for delivery you need to pay a £2000 refundable deposit plus a £460.00 fee. As ever, it's the little guy who suffers most from all this.