Lufthansa’s billion Euro government rescue stands in sharp contrast to the free market approach taken by U.S. airlines in raising the capital necessary to bridge the corona-lockdown. It also explains why the recovery of European stock markets lags the U.S. by substantial margins, illustrating what is going wrong in the Eurozone.
Raising Capital
On April 20, United Airlines raised $1 billion in equity in the financial markets. The capital raise occurred at a 5% discount to the already depressed stock price. But despite the bleak state of the industry, with 90% of the fleet grounded,