It is certainly true that a crisis is always also an opportunity /Martin Sandbu, FT, 9 September 2020/. We really need a pan-European recapitalization approach, even targeted government schemes for recapitalization.
However, we do not need all “zombie” corporations to survive, the “walking dead” should sink forever. Who can tell the difference between the two?
All companies have their balance sheets for the last three “normal” years before 2020. We can surely accept the verdicts of the markets. A government-led recapitalization scheme can easily separate the two groups, potential survivors and the “ready-to-die” corporations, from each other. Only the first group should be eligible for any future recapitalization.
Governor Matolcsy, MNB, the Central Bank of Hungary