objective

Caterpillar's Troubling Bond Issue

I agree CAT is a "bank".
But a "bank" without access to deposits for capital and the Fed discount rate for reserves...
CAT has to borrow the money they lend.
I Suggest this model may be broken. That is basically what BearStearns/Lehman/AIG... etc. did...
The supposed "smartest" people at GS and Morgan Stanley have given up and converted to the commercial bank model, so can CAT keep it going if the I-banks can't?... I think you have to take this into consideration when looking at a CAT/GE/GM etc...who depend on borrowing $ to lend to others....
If they get out or are forced out of finance, can they line up banks willing to lend to their equipment customers with underwriting standards that will still result in previous sales volumes?