what the hell are we going to do? GM wants $14 billion more. this is some pretty heavy stuff.

Automakers Seek $14 Billion More in Aid

http://www.nytimes.com/2009/02/18/busin ... ml?_r=1&hp



analysis later in the story:


i understand this could have been put in the economics thread, but i was hoping to use this as a point of interest toward that end but only concerning the automaking industry. do we not have a thread on that?

these companies have underperformed and not kept with technology for ages. why should the government bail out bad business?

duh. union members vote.

I don't think the government should bail them out, but what impact would it have on the economy of the surrounding areas, related businesses, and companies that sell to the people who will be laid off otherwise?

I don't pretend to have an answer to what to do for the auto industry but since this country appears to run strictly on consumerism, which I think to be a bad thing, btw, then what do you do when a failing company collapses and the 100,000 people who it employed are no longer spending even credit card money now- how do you stop a domino effect of failing businesses as a result?

this is getting kind of tired, honestly. You're a smart guy in this subject- talk about it instead of making stupid lopsided quips about it.

honestly I have no problem with all the radical conservative views being flung about so recklessly in these threads as of late, but I'm having trouble remembering a similar reaction to Paulson (or however his name is spelled) forcing through the first massive injection of cash to banks and the like back in Oct, from any of you guys.
I wasn't thrilled with that move either, but all I've read over the last month with the Obama administration in office is about how terrible it is the actions they are taking right now, but I honestly don't remember you guys saying that while W. was in office.

i entertain the same thoughts.

Give the money to the workers and let the company rot.

the media focus and objections to the auto bailout are a slap in the face to blue collar people everywhere. hundreds of billions of dollars were pushed through for the financial sector with nary an objection. but 25 billion for the car companies and there was nonstop nonsense going on about it.

using money from locales A - Y to help a business in locale Z certainly helps all the ancillary businesses in locale Z who rely upon a vibrant "anchor" business, if you will. but it follows that the businesses in locales A - Y whose health is a direct function of the condition of similarly large "anchor" businesses in A - Y suffer as a result of the "anchor" businesses having less income of their own. it's a classic case of the seen vs. the unseen.

in other words, the viability of surrounding businesses in one place is improved only as a consequence of some other less visible, but no less important, businesses' deterioration.

what exactly is your fucking problem? it's late, and i was trying to playfully bust ceebs balls a bit tonight before addressing the more substantive stuff tomorrow. lighten up.

and in the future, i'll be sure to run my posts by you to make sure they're suitable for public consumption.


then you clearly weren't paying attention to my posts. i've been against everything the fed, treasury, paulson, bernanke, bush, geithner, summers, etc has done from the start.

We've been over this before. It's an absurd comparison. The "big three" auto companies failing is a drop in the pond next to what would happen if the big banks collapse.

Now, that doesn't mean I agree with their handling of the financial sector, either.

Oh, and as far as these companies are concerned... Let them rot. That means capital goods will be easier to come by for the automakers that have acted more responsibly, many of whom themselves have operations and employ lots of people in the United States. Protectionism is stupid.

I remember significant resistance to the financial bailout, especially the 'its irresponsible to wait a day or two to figure out what all this means before voting on it' bit.

sigh


Why, oh why, oh why do we insist on keeping the automakers on life-support. Sadly we all know the answer and it's almost too frustrating to even think about.

Why the fuck are they still trying to hold onto Pontiac? GM has far too many competing brands. Ditch Pontiac, Saturn, Buick, GMC and Hummer. Pontiac used to be their performance brand...now they're nothing more than rebranded Chevy's. GMC is just a higher trim of Chevy trucks. There is no need for that kind of overlap. Unless they intend to change the focus of any of these brands, they need to go.

Once they've trimmed all that fat then they need to work on building cars that people actually want. Stop focusing on oversized SUV's and put out a compact car that people actually want to buy. That Aveo is one of the worst sub compacts on the market...it's a fucking rebranded Daewoo for christ's sake! At least the Cavalier, for all it's lameness, sold well.

Lastly, i feel that if a company is getting a bailout, part of their restructuring program should involve a commitment to environmentally friendly technology. I've seen several articles that outline how GM could avoid closing some of it's plants by using them to refit current GM models with electric and hybrid engines.

Oh, and both the executives and the UAW might want to consider taking a pay cut if the remaining workers would like to have jobs a few years from now.

We're damned if we do, and damned if we don't.

I'd like to see both the automakers and the UAW take a big fat lesson in sucking it up without help. But that's just me. *shrugs*
What are the chances the prices of vehicles would drop if automakers weren't bailed out? That's a question in which I keep wondering what the answer might be.

Their argument is that they're asking for loans, which they have a plan to pay back. That all car makers, globally, are having trouble selling cars because consumers around the world can't get car loans. And finally, that they wouldn't, under normal circumstances, have trouble getting loans from private sources if the commercial credit markets were functioning normally. Furthermore, Japan is offering both Honda and Toyota lines of credit should they need them. South Korea has already provided Hyundai and Kia interest-free loans. These are extraordinary times.

Still don't understand why Bankruptcy isn't an option for Automakers when it worked for the Airline industry?

when they liquidate (creating...ooooh staggering job losses) They will be forced to reorganize and develop a plan to become a better company. (ooooh staggering job opportunities)

Currently the plan is.... beg every month to get more and hope. No company that large should be completely dependant on credit for survival... if they are.... they need to restructure.

They have been delaying the inevitable for 30 years.

Yay... SUV's lets hitch our wagon while gas is cheap... nice move.... same deal with the Airlines...

Shit Can planning.

Consider this the pennance for planned obsolescence

It would be the best option for them if possible. Here are the problems today:

1. GM has already inquired into liquidation. Ordinarily, that would be a great option. It would allow people to be employed by new companies using GM's in-place capital assets, and we could have new, innovative car manufacturers. This isn't really viable at the moment because of the frozen credit markets.

2. The only asset that anyone is interested in is GM's pension fund. It's apparently one of the best managed funds in the country, easily able to support it's retirees If GM went into bankruptcy, this fund would be liquidated. And the pensioners would be thrown into the Federal Government's already overburdened pension guarantee fund, and remain there until they died.

Estimates are that, including unemployment costs, the Federal Government would spend more money today allowing GM to go into bankruptcy.

Essentially, there are no good options.