"I believe it is in the best interests of the Government and taxpayer to support OZ via a guarantee or even putting up funds as a last resort. Why? - because it is in their best interests."
Maybe in this instance. But what about the next 10 companies that want bailing out? Its a dangerous precedent to set bailing out the private sector because taxpayers haven't the luxury of knowing their government are competent enough to make sound fundamental decisions. Nor is it the governments responsibility.
"For most people selling (or being forced to sell) at 82.5 cents will almost certainly mean selling at a loss. This means tax losses and therefore less tax revenue to the Government."
"What does this cost the Government / taxpayer? Nothing."
More revenue only if OZL becomes profitable again. Who says if they get their billion odd dollars it will be a profitable company? What if the world heads into a depression and copper falls below operating margins?
"Even if thrown a lifeline and OZ does go broke, the assets still outweigh the debt"
At the moment yes. What about tomorrow?
"I believe that in years to come we will view this current financial crisis as a relatively short period of madness where we lost many great companies."
If they went under they weren't great companies. Great companies survive the bad times.
Point being made is it isn't the governments role to bail out the private sector. Let the free market deal with it like its been designed to. There was bailing out of financial institutions in the US in the mid-late 90s. If these entities were left to fail like they should have been there would have been a wake-up call across the sector.
Bailing out companies sets a dangerous standard that will ultimately be more detrimental to the economy as opposed to letting the bad ones fail.
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