By Maxine Shapiro, KERA 90.1 Commentator
Dallas, TX – It's Friday, so "It's Only Money," a review of the big and not so big stories of the week. I'm Maxine Shapiro with KERA Marketplace Middays.
WorldCom execs will be on Capitol Hill on July 8th to testify in front of a House financial service panel. Expect the Fifth. This alleged financial fraud has sent everyone and anyone associated with World Com financially scurrying to recoup losses before WorldCom files for bankruptcy protection.
Yesterday the Texas Attorney General's office announced that it would investigate any possible way it could recover funds owed to the state or any losses from investment funds and state pensions. See, billions of dollars were invested in WorldCom. The Teacher Retirement System of Texas and the Employees Retirement System of Texas, to name of couple. If WorldCom should file for bankruptcy, they can almost kiss that money good-bye. That's why they call it protection. You can't sue a company for something they don't have.
But World Com believes that by laying off 20% of their workforce (that's 17,000 employees worldwide including Richardson), they won't need to file for bankruptcy. Now, just in case you weren't aware, WorldCom had real problems before this week. The SEC was already investigating their accounting practices, their stock price had plummeted, and they had a "looming $30 million debt." Back in April, they threw out longtime CEO Bernard Ebbers. Ebbers will be one of many making the trip to Washington. I hear it's good and hot there this time of year.
And according to the Dallas Business Journal Online, American Airlines will not ask the government for a loan. This was the loan that was offered to airlines after September 11th. See, American says they wouldn't qualify anyway - their financial position is too strong. That's good?!
For KERA Marketplace Midday, I'm Maxine Shapiro.
Marketplace Midday Reports air on KERA 90.1 Monday - Friday at 1:04 P.M.