Investors Have Lost Their Shirts On Peabody; Now Taxpayers Are In The Line Of Fire

Investors Have Lost Their Shirts on Peabody; Now Taxpayers Are in the Line of Fire by Tim Buckley, IEEFA.org

The U.S. coal sector is in financial distress, a fact that’s been apparent for some time now and is made more evident with this week’s second-quarter earnings report from Peabody Energy.

Peabody continues to tank for the main reasons many other major coal producers continue to tank: It made too many top-of-the-cycle, multibillion-dollar debt-funded acquisitions and its executives have continued to pretend that they can’t see the oversupply in a seaborne coal market that is in structural decline.

Meanwhile, Alpha Natural Resources has been delisted from the New York Stock...