PG&E Bankruptcy Will Test Shareholder Capitalism

By J.B. Heaton (September 16, 2019, 12:32 PM EDT) -- Shareholders are said to be residual claimants. This means that shareholders ought to be paid in full only after the corporation pays its creditors. Outside bankruptcy proceedings, this idea is barely alive. Corporations routinely give assets away to their shareholders in the form of dividends and share repurchases long before they have satisfied creditors, both voluntary contract creditors and involuntary tort creditors....

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