Bankruptcy in China
BANKRUPTCY IN CHINA....China's manufacturing decline has accelerated recently due to the global financial meltdown, but apparently China's provisions for corporate bankruptcy aren't quite as smooth as one might hope:
First, Tao Shoulong burned his company's financial books. He then sold his private golf club memberships and disposed of his Mercedes S-600 sedan.
And then he was gone. And just like that, China's biggest textile dye operation — with four factories, a campus the size of 31 football fields, 4,000 workers and debts of at least $200 million — was history.
....In recent weeks, there have been many fires, increasingly large-scale. In Zhejiang province, south of Shanghai, Ye [Hang] counted at least six major bankruptcies, including Jianglong; Feiyue Group, China's biggest sewing machine maker; and Zhejiang Yixin Pharmaceutical Co., among the largest in that industry.
"Of these six, one [owner] committed suicide, one was detained by police, and the remaining four all escaped," he said. "I can imagine that in the future, there would be more such cases as a result of the chain reaction."
I don't especially want anyone committing suicide, but I confess that the thought of Wall Street executives in failed banks either being detained by the police or going to ground and hiding in terror holds a certain appeal. Is there any chance that the U.S. could import the Chinese method temporarily just for the financial industry?