The more that comes out about this company, the more it becomes apparent that this was a horrible investment of money to start with. From the Government! I know, you must be as shocked as I was. As Zero Hedge noted, when you're producing a low-margin commoditised product like solar panels, and you've got revenues of $58 million versus cost of goods sold of $108 million, that's a recipe for the fast track to insolvency. Coyote's description is almost right:
Even in the worst run late 90′s Internet company I ever encountered, they were not selling dollars for 50 cents.True enough. My only quibble with this metaphor is that if Solyndra were actually selling dollar bills for 50 cents, it would be a big improvement, because at least the final product would be re-salable for a full dollar. Here, it's more like they took a dollar bill to the 7-11, got change in quarters, melted two of the quarters into a blob of metal and proceeded to flush the blob down the toilet.
There is only one silver lining that I can see in this whole mess. At least the company actually went bankrupt, and now hopefully will be liquidated. In other words, taxpayer losses appear limited to only (only!) $500 million of yours and my money. By contrast, had Solyndra managed to limp along long enough to become a large political constituency, we probably would have been on the hook for much larger ongoing bailouts. It could have been added to the pantheon of dollar-bill blast furnaces of General Motors, Chrysler, Fannie Mae, Freddie Mac and the Post Office that no matter how badly they perform, the government picks up the tab and nobody ever gets fired.
The best thing Solyndra did for us was to fail fast enough and spectacularly enough that even the most coked-out green energy fanboys in the government couldn't justify throwing more money its way. You'll forgive me for not celebrating this fact too highly.
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