Sep

29

 Jamie Dimon on his last quarter earnings conference call said: "We maintained our fortress balance sheet, ending the second quarter with Tier 1 capital ratio of 10.1% JPM corporate debt rating: AA-/A"

Today's GM press release announcing a new labor contract read: "Importantly [the contract] preserves GM's fortress balance sheet."

GM corporate debt rating: B/BB-

If one only looks at the debt on the GM balance sheet, things look ok (about $10 Billion in LT Debt).

However this ignores the fact that GM has a $31 Billion (and growing) underfunded pension liability. Unlike most of the debt which was extinguished, this monster pension liability survived their bankruptcy reorganization.

Not all fortresses are created equal.


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