Washington Post business columnist Steven Pearlstein was online Wednesday, Nov. 15 at 11 a.m. ET to discuss Hertz's plans to go public and what this says about Ford, who sold the company last year, and Wall Street.

Read today's column: Hertz Case Is Example of What Ails Big Three.

For more information about Hertz read the news story from Tuesday's Business section: An IPO in Overdrive by Chris Kirkham.

A transcript follows.

About Pearlstein: Steven Pearlstein writes about business and the economy for The Washington Post. His journalism career includes editing roles at The Post and Inc. magazine. He was founding publisher and editor of The Boston Observer, a monthly journal of liberal opinion. He got his start in journalism reporting for two New Hampshire newspapers -- the Concord Monitor and the Foster's Daily Democrat. Pearlstein has also worked as a television news reporter and a congressional staffer.

His column archive is online here.

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Alexandria, Va.: Is the Japanese yen systematically undervalued (as the Detroit automakers claim)?

Steven Pearlstein: The argument is that Japan stopped intervening to keep the yen down about 18 months ago, so that the current value is, indeed, the market value. I think that misses a big point about Japan, which is that its government and major banks and financial institutions still work hand in hand to accomplish the same thing in other ways, by limiting the demand for yen from outside the country. There is also the system Japan has set up for using China, whose currency is pegged to the dollar, as a major target of FDI and source of parts for its manufacturing machine. And, of course, their markets remain remarkably closed to US goods and services, if not by rules, than by cultural consensus.

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Laurel: Ford and GM are both losing money. Neither is worth much on a book value basis, but they both must own a lot of "hidden assets" -- property still carried on the books at what it was bought for 1920, less depreciation, and would obviously be gold mine if sold.

ASSUMING (big if) that they do have the availability to turn their current operations around and eventually make a profit based on superior engineering, doesn't selling off some current assets to get them there make some sense?

As an aside, is it possible that the auto industry considered as a whole has improved its products enough to no longer be profitable? Many financial advisors recommend to "never buy a new car." Might there be too many cars that are too cheap that they're truly not worth making any more at the scale they have been?

Steven Pearlstein: Lot of interesting points there. Your comment that the companies are undervalued is correct, but for one thing: the liabilities hanging over their head for retiree pensions and health care. This is the financial lodestone around their necks. And it would be good for them, and the economy as a whole, if they could reach a grand bargain with the Pension Benefit Guaranty Corp, and the unions, to get a good chunk of those liabilities off their books, while also getting related assets now into the hands of employees so that any bankruptcy would not affect them. As part of the same refinancing process, they might also consider going private, if, as you state, the assets, including the brands, are undervalued.

Does selling off assets make sense now? Sure. But there are different ways to monetize them, and selling them at a bargain basement price to private equity sharpies doesn't strike me as the best option. They could have done the refinancing and the IPO themselves and been 2 or 3 billion dollars richer, which isn't chump change for a company valued by the market at, what, $7 billion.

Yes, cars last longer, but overall sales of new cars in this country has not declined, as we have more people and each person, on average, has more cars.

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Arlington, Va.: What are the odds that one of the big three declares bankruptcy in the next few years and is bought out by a foreign car manufacturer? To someone outside the industry, it just doesn't seem that it's possible they can be profitable with their pension/health care problems.

Steven Pearlstein: Without some substantial change in their balance sheets and union contract, the chances are probably pretty good. We've just come through a very robust economic period, and they didn't make any money. Imagine what happens the next time we have a recession!

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Anonymous:"What are the odds that one of the big three ... is bought out by a foreign car manufacturer?"

Didn't that already happen?

Steven Pearlstein: Yes it did. And further, international consolidation is almost certain, although one would hope it would be Ford and GM that were doing the consolidation. They have the better global brand names and it would be better for the U.S. economy. But right now, they are in no financial position to do it.

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Vienna, Va.: As always, your article was great. There was one section that caused me to really sit back and think about the whole concept of stock valuation. My position has always been that stocks are valued on the future earnings potential of a firm.

Say a market segment consists of company A and company B. If company A performs well, their stock goes up. When their stock goes up, that market segment shows a gain their industry... but I don't see how that carries over to company B?

Yet, Jay R. Ritter (finance professor at the University of Florida) said that "the gain in the market makes Hertz more valuable."

I'm going through my old Graham and Dodd, but I can't find the basis behind his stmt.. Did he provide support for his theory that, in effect, says increases in aggregate market segment price data will increase the value of all stocks within that market segment?

Steven Pearlstein: Well, Graham and Dodd won't help you much on this one. The simple explanation is that market are a bit screwy in the short term. One year the market multiple on S&P stocks generally can be 14, and the next year it can be 17. The rational explanation is that the prospects of growth in earnings has changed. But the more correct explanation is that markets can get a bit frothy and irrational, or there is suddenly more money chasing dollar denominated investments than last year. So one reason Hertz is worth more today versus last year is that the stock market overall is up, and business travel is at or near records. But that doesn't explain all or even most of the $3 billion that Ford left on the table.

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Burke, Va.: One of the issues that the automakers bring up is steel costs. The US still has import duties on more than 160 steel products. Given the consolidation of the steel industry in the US and its remarkable profits, this seems to me a legitimate point - and also shows the dangers that lurk for the Dems if they start imposing trade restrictions - the restrictions hurt U.S. manufacturers more than the foreign targets. Do you agree with this?

Steven Pearlstein: World steel prices went through the roof last year and the beginning of this year, and now they are falling. The quotas on imports into the US probably aren't a big factor in the short run. The car companies have longterm contracts with US-based suppliers. And the difference the quotas make on a single input into the price of the car just isn't very big. A couple of percentage points increase in health care costs is probably a bigger deal.

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Steven Pearlstein: Thanks, folks. I guess we solved the problems of the auto companies pretty quickly. See you next week.

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