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Paul Allen |
Charter Communications, the cable company that Allen is said to have a 50% stake in, has filed for bankruptcy, after not making interest payments of $73 million dollars. The bankruptcy reduced the company's debt by 8 billion dollars. Reportedly, Charter had 21 billion dollars in long term debt. For a look at Charter's stock price free fall, click here. Allen did receive some much-needed good news regarding Charter in the form of President Obama's stimulus bill -- which should net him some tax savings.
Last month, Paul Allen reportedly laid off 50 employees at Vulcan, 9 percent of the total staff.
Here's Microsoft's stock price history. As recently as April 2008, Microsoft was trading at 31. Today, it trades at 17. According to the most recent report I could find, Paul Allen owned 136 million shares of Microsoft stock as recently as 2006. Obviously this number could have changed dramatically in the last 3 years. But that stake, at last April's stock price, would have been worth roughly 4.2 billion dollars. Based on today's stock price, that holding would be worth roughly 2.2 billion dollars.
On Valentine's Day it was announced that Paul Allen sold off his remaining stake in DreamWorks Animation Studio, ending a fifteen year business relationship.
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Definition:
Is the prospect that a party insulated from risk may behave differently from the way it would behave if it were fully exposed to the risk. Moral hazard arises because an individual or institution does not bear the full consequences of its actions, and therefore has a tendency to act less carefully than it otherwise would, leaving another party to bear some responsibility for the consequences of those actions. |
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