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Just how serious the industry's financial plight has
become is pointed up by three searing facts:
Credit ratings are falling
by Data Resources, Inc. indicate that since 1970, of 44
utilities surveyed, 26 had their bond ratings lowered by
Moody's and Standard and Poor's, while only four were able to
improve their ratings.
Utility shares are selling below book value
review of a composite of 64 utilities shows that in 1979
their ratio of market to book valué had dropped to 81
a striking contrast from ten years earlier when
their market value was 235 percent of book.
are required to sell common stock below book value, they are
caught on the horns of a dilemma.
The sale of stock only
further weakens their book value.
Yet, they must continue
to do equity financing to meet capital requirements.
Perhaps most dangerous of all, a number of utilities
are paying out more in dividends than they take in in net
to work their way out of their financial plight.
needed, and it must be timely and generous.
This is a
Unlike many industrial nations, we have it within our
balance of payments problems, create jobs here at home,
permits, and programs to the "front burner" so that these
objectives can be achieved.
The coal industry is blessed
with an unparalleled opportunity.
We dare not let it slip
through our fingers because of inaction, red tape, and lack
Competition in the Coal Industry, Report of the Justice
Competition in the Coal Industry
Report of the U.S. Department of Justice
Pursuant to Section 8 of the Federal Coal Leasing Amendments Act of 1976 for Fiscal Year 1979
This Report was prepared by the Antitrust Division of the Department of Justice, Sanford M. Litvack, Assistant Attorney General. Gregory J. Wer den (Economist, Economic Policy office), Nancy H. McMillen, and Thomas A. Balmer (Attorneys, Energy Section), arafte, the Report with the assistance of John W. E. Bowen (Attorney, Energy Section), Judith E. Retchin (Attorney, Transportation Section), and Lee Sparling (Economist, Economic Policy Office), under the supervision of kobert Fabrikant, Assistant Chief of the Energy Section; Donald A. Kaplan, chief of the Energy Section; Elliott M. Se iden, Chief of the Transportation Section; Peter R. Greenhalgh, Assistant Director of the Economic Policy Office; Bruce M. Owen, Director of the Economic Policy Office; and under the general supervision of Richard J. Favretto, Deputy Assistant Attorney General. This Report was typed by Susan Feirson, Carolyn Berens, Helen L. Freitag, Joyce L. Marison, and Rose S. Walsh.