Are there still any hopeless romantics who support the bailout?

StageLeft

No Lifer
Sep 29, 2000
70,150
5
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Link

General Motors Corp. said its auditors have raised substantial doubt about the company's ability to continue operations.

A lot us around here knew that the money given last year was going to serve no need but simply push the problem ahead, since it was merely to cover operating costs. GM has been burning through cash at an obscene rate and is in no better position right now than it was when it first got its billions last year.

What about the conditions for more money? Who thinks that holds any water?

My guess is that the gov gives it to them. This is exactly how it was always going to play out, there was no alternative. The math pointed out last fall was that the holdover money was going to be done by around March and, oh look, it's March, so now this is exactly as it was last fall except now the gov is a touch poorer for it.
 

tvarad

Golden Member
Jun 25, 2001
1,130
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0
Originally posted by: Skoorb
Link

General Motors Corp. said its auditors have raised substantial doubt about the company's ability to continue operations.

A lot us around here knew that the money given last year was going to serve no need but simply push the problem ahead, since it was merely to cover operating costs. GM has been burning through cash at an obscene rate and is in no better position right now than it was when it first got its billions last year.

What about the conditions for more money? Who thinks that holds any water?

My guess is that the gov gives it to them. This is exactly how it was always going to play out, there was no alternative. The math pointed out last fall was that the holdover money was going to be done by around March and, oh look, it's March, so now this is exactly as it was last fall except now the gov is a touch poorer for it.

I can't but help agree with this. The fundamental cause of the current global crisis is the creation of international behemoths without accountability. How pumping money into such entities will resuscitate them is beyond me.

The politicians have no handle on it. This is Plan A. Wait for Plan B, Plan C and so forth.
 

Strk

Lifer
Nov 23, 2003
10,197
4
76
It's becoming more difficult to support it, that's for sure. GM has been slow to respond to the changes in the market. While they have released a few new vehicles that are very competitive, a good chunk of their line is still a year or more away. A lot of the new models are 2010/2011 models.

At least if Ford actually took the loans it wanted assured, their viability is much greater thanks to starting much earlier on updating their line. The last two major updates will be the 2010 Taurus (seriously, they didn't need to rename it to one with such stigma; just make it like the 2010 model, which is an awesome looking car). The Fiesta will be a great addition too. That one shouldn't take long to get here. A truck plant in Mexico is already being retooled to build it.
 

Red Dawn

Elite Member
Jun 4, 2001
57,529
3
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Originally posted by: Strk
It's becoming more difficult to support it, that's for sure. GM has been slow to respond to the changes in the market. While they have released a few new vehicles that are very competitive, a good chunk of their line is still a year or more away. A lot of the new models are 2010/2011 models.

At least if Ford actually took the loans it wanted assured, their viability is much greater thanks to starting much earlier on updating their line. The last two major updates will be the 2010 Taurus (seriously, they didn't need to rename it to one with such stigma; just make it like the 2010 model, which is an awesome looking car). The Fiesta will be a great addition too. That one shouldn't take long to get here. The Fiesta is already being manufactured in Mexico.
If the cost of them failing wouldn't make the cost of bailing them out look like peanuts I'd say let them fail. Unfortunately if they fail the result would be devastating on the economy.
 

StageLeft

No Lifer
Sep 29, 2000
70,150
5
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If the cost of them failing wouldn't make the cost of bailing them out look like peanuts I'd say let them fail. Unfortunately if they fail the result would be devastating on the economy.
Perhaps so, but the government I think owes the tax payers more on this. Simply throwing money at GM because its failure (which, should it follow this particular path, is ultimately guaranteed) is painful is hardly a good solution, especially with how much it's costing. Indefinite propping up of GM is not a solution
 

chess9

Elite member
Apr 15, 2000
7,748
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Well Red, my fear, and the fear of many, is that we will bail them out, and bail them out, and bail them out, and they will still fail. This strikes many as the likely scenario, given the quislings who work on Capitol Hill and the little economic drama unfolding before us.

-Robert
 

heyheybooboo

Diamond Member
Jun 29, 2007
6,278
0
0
I see the moral hazard in ongoing bailouts.

But if the alternative is the complete failure of Generous Motors I don't find that acceptable. The 'trickle-down' unemployment would be massive - most likely approaching 2 million jobs lost. ""As GM goes, so goes the country ... ""

As long as the gov't maintains an equity stake which may be repaid in better times (or recouped in the event of utter failure) I am resigned to the support. A pre-packaged bankruptcy with concessions from management, investors and labor may be the only remaining alternative - with those bailed-out banks extending credit with the taxpayer dollars we gave them.

And the terms have to be draconian to dissuade others - and to prevent the US lost production from simply moving overseas.
 

Strk

Lifer
Nov 23, 2003
10,197
4
76
Originally posted by: Skoorb
If the cost of them failing wouldn't make the cost of bailing them out look like peanuts I'd say let them fail. Unfortunately if they fail the result would be devastating on the economy.
Perhaps so, but the government I think owes the tax payers more on this. Simply throwing money at GM because its failure (which, should it follow this particular path, is ultimately guaranteed) is painful is hardly a good solution, especially with how much it's costing. Indefinite propping up of GM is not a solution

I doubt it would be indefinite, but it won't be short either. The one thing I don't get is why AIG and the banks are given money so freely that, let's face, we will never see again. Yet GM can barely get a fraction of it with guarantees to repay the loans.
 

craftech

Senior member
Nov 26, 2000
779
4
81
I doubt it would be indefinite, but it won't be short either. The one thing I don't get is why AIG and the banks are given money so freely that, let's face, we will never see again. Yet GM can barely get a fraction of it with guarantees to repay the loans.
===============
Because they have unions that the Republicans with the help of the news media can bust using lies about their wages, etc. Americans are the world's dumbest thanks to the news media we have. Say "the media is liberal" four times and the American parakeets will repeat it despite what they see and hear right before their eyes. Pathetic.
 

StageLeft

No Lifer
Sep 29, 2000
70,150
5
0
Originally posted by: Strk
I doubt it would be indefinite, but it won't be short either. The one thing I don't get is why AIG and the banks are given money so freely that, let's face, we will never see again. Yet GM can barely get a fraction of it with guarantees to repay the loans.
I also don't understand this, especially since more tax payers are behind the auto bailouts than the bank ones, but if a bank needs another $30 B it's a few phone calls and Bernanke is signing the dotted line.

I'm not sure of the figure, but I know that if a fraction of what was going at banks went to the auto manufacturers, all their liabilities and debts could be expunged (NOT saying this should happen, just pointing it out!).
 

boomerang

Lifer
Jun 19, 2000
18,883
641
126
As Goes GM, So Goes the Nation

Sums up the rise and fall pretty well. I still contend that the ripple effect of GM and Chrysler going under will have extremely negative impacts on our nation. However, I feel that we are in a downward spiral that bullet trains and icebreakers are not going to pull us out of. People are not going to buy cars until the confidence in their jobs and our economy returns. There is not enough demand to keep two domestic manufacturers afloat until then. Maybe not even one.

When you've got people like Geithner who contributed greatly to our downfall orchestrating their recovery it's foolish to expect different results. It's really nice to give him another chance, but the cost is pretty astronomical.

Remember, when your neighbor is out of a job, it's a recession, when you're out of a job it's a depression.
 

dahunan

Lifer
Jan 10, 2002
18,191
3
0
Originally posted by: Skoorb
Originally posted by: Strk
I doubt it would be indefinite, but it won't be short either. The one thing I don't get is why AIG and the banks are given money so freely that, let's face, we will never see again. Yet GM can barely get a fraction of it with guarantees to repay the loans.
I also don't understand this, especially since more tax payers are behind the auto bailouts than the bank ones, but if a bank needs another $30 B it's a few phone calls and Bernanke is signing the dotted line.

I'm not sure of the figure, but I know that if a fraction of what was going at banks went to the auto manufacturers, all their liabilities and debts could be expunged (NOT saying this should happen, just pointing it out!).

While they were villainized for their private jet.. :-( Look at what the punkass fratbitch bankers did .. Hey homie.. here is your 70 million dollar bonus.. HAHAHAHAHAHAH.. Fuck those stupid americans.. lol
 

Genx87

Lifer
Apr 8, 2002
41,091
513
126
I was told yesterday that we should never let these companies die because somebody might lost their job. I say toss them another 30 billion and see what happens.
 

sandorski

No Lifer
Oct 10, 1999
70,749
6,319
126
The Government will need to crack down before continuing Bailouts. I find it exceedingly difficult to believe GM can't Restructure to a viable Company. Cut every Vehicle that doesn't turn a Profit, nothing is sacred at this time, even Cadillac and Corvette needs to be chopped if not turning a Profit. Racing Teams are a Luxury, cut. Nix all Duplicate Models, mothball some subsidiaries. Focus on fewer more Mainstream vehicles.

The big problem with all that though are the Legacy costs, Healthcare and Retirement. The best Bailout might be to simply take on those obligations. Perhaps only temporarily, but at least that much.
 

Red Dawn

Elite Member
Jun 4, 2001
57,529
3
0
Originally posted by: chess9
Well Red, my fear, and the fear of many, is that we will bail them out, and bail them out, and bail them out, and they will still fail. This strikes many as the likely scenario, given the quislings who work on Capitol Hill and the little economic drama unfolding before us.

-Robert
We have an example in the past where bailing out a Car Company actually worked with Chrysler. Hey I wish we could let them fail and not be worse off for it than if we kept feeding them money until they became self sufficient. I wish we could let all the banks, INS companies and every other financial backbone of our economy fail instead of giving them money but the domino effect of doing that would be catastrophic. If we let that happen many who think their livelihoods are recession/depression proof might find out they are mistaken.
 

craftech

Senior member
Nov 26, 2000
779
4
81
Originally posted by: sandorski
The Government will need to crack down before continuing Bailouts. I find it exceedingly difficult to believe GM can't Restructure to a viable Company. Cut every Vehicle that doesn't turn a Profit, nothing is sacred at this time, even Cadillac and Corvette needs to be chopped if not turning a Profit. Racing Teams are a Luxury, cut. Nix all Duplicate Models, mothball some subsidiaries. Focus on fewer more Mainstream vehicles.

The big problem with all that though are the Legacy costs, Healthcare and Retirement. The best Bailout might be to simply take on those obligations. Perhaps only temporarily, but at least that much.

There are no calls for AIG to restructure, or any of the other lending institutions etc. Only GM because it involves labor unions. The corporate news media spent most of their efforts distorting and lying about union wages for the Republicans and obsessing over it for them just to help them possibly bust the unions. The LOAN to GM became a national obsession as a result of the trained pets Americans have become thanks to our news media.
 

Genx87

Lifer
Apr 8, 2002
41,091
513
126
Originally posted by: craftech
I doubt it would be indefinite, but it won't be short either. The one thing I don't get is why AIG and the banks are given money so freely that, let's face, we will never see again. Yet GM can barely get a fraction of it with guarantees to repay the loans.
===============
Because they have unions that the Republicans with the help of the news media can bust using lies about their wages, etc. Americans are the world's dumbest thanks to the news media we have. Say "the media is liberal" four times and the American parakeets will repeat it despite what they see and hear right before their eyes. Pathetic.

Perhaps you missed an event that happened last November. This event ushered in a democrat near super majority in both chambers and a democrat president. Republicans are a sideshow right now and cant do squat. If you are complaining about the above, complain to the democrats as they hold the power.
 

craftech

Senior member
Nov 26, 2000
779
4
81
Originally posted by: Genx87
Originally posted by: craftech
I doubt it would be indefinite, but it won't be short either. The one thing I don't get is why AIG and the banks are given money so freely that, let's face, we will never see again. Yet GM can barely get a fraction of it with guarantees to repay the loans.
===============
Because they have unions that the Republicans with the help of the news media can bust using lies about their wages, etc. Americans are the world's dumbest thanks to the news media we have. Say "the media is liberal" four times and the American parakeets will repeat it despite what they see and hear right before their eyes. Pathetic.

Perhaps you missed an event that happened last November. This event ushered in a democrat near super majority in both chambers and a democrat president. Republicans are a sideshow right now and cant do squat. If you are complaining about the above, complain to the democrats as they hold the power.

You no doubt missed my feature article of the day:

http://forums.anandtech.com/me...=2283145&enterthread=y

I don't blame you for being brainwashed by the universal Republican controlled corporate media. Most people are.
 

halik

Lifer
Oct 10, 2000
25,696
1
0
Originally posted by: boomerang
As Goes GM, So Goes the Nation

Sums up the rise and fall pretty well. I still contend that the ripple effect of GM and Chrysler going under will have extremely negative impacts on our nation. However, I feel that we are in a downward spiral that bullet trains and icebreakers are not going to pull us out of. People are not going to buy cars until the confidence in their jobs and our economy returns. There is not enough demand to keep two domestic manufacturers afloat until then. Maybe not even one.

When you've got people like Geithner who contributed greatly to our downfall orchestrating their recovery it's foolish to expect different results. It's really nice to give him another chance, but the cost is pretty astronomical.

Remember, when your neighbor is out of a job, it's a recession, when you're out of a job it's a depression.

Love this quote:
Amazingly, when you provide 0% financing to people with 550 credit scores, you can sell millions of Escalades and Hummers.
 

Genx87

Lifer
Apr 8, 2002
41,091
513
126
Originally posted by: craftech
Originally posted by: Genx87
Originally posted by: craftech
I doubt it would be indefinite, but it won't be short either. The one thing I don't get is why AIG and the banks are given money so freely that, let's face, we will never see again. Yet GM can barely get a fraction of it with guarantees to repay the loans.
===============
Because they have unions that the Republicans with the help of the news media can bust using lies about their wages, etc. Americans are the world's dumbest thanks to the news media we have. Say "the media is liberal" four times and the American parakeets will repeat it despite what they see and hear right before their eyes. Pathetic.

Perhaps you missed an event that happened last November. This event ushered in a democrat near super majority in both chambers and a democrat president. Republicans are a sideshow right now and cant do squat. If you are complaining about the above, complain to the democrats as they hold the power.

You no doubt missed my feature article of the day:

http://forums.anandtech.com/me...=2283145&enterthread=y

I don't blame you for being brainwashed by the universal Republican controlled corporate media. Most people are.


And what exactly does that have to do with bailing out the auto companies?
 

Moonbeam

Elite Member
Nov 24, 1999
74,674
6,733
126
These, 'I have the economic issues figured out' threads look to me like attempts to manage fear, much like when we replay and replay some traumatic event in our head, compulsively. I sense a need to be in control and the horrible fear that our fate is out of our hands. The beauty of say, Islam, is the notion that all that happens is the will of God and that a good man has nothing to fear, in this life, or the next. The wind that blows, the sun that warms my skin, the birds that land in my yard are all free and don't care about the economy and I am rich beyond measure.
 

craftech

Senior member
Nov 26, 2000
779
4
81
Originally posted by: Genx87
Originally posted by: craftech
Originally posted by: Genx87
Originally posted by: craftech
I doubt it would be indefinite, but it won't be short either. The one thing I don't get is why AIG and the banks are given money so freely that, let's face, we will never see again. Yet GM can barely get a fraction of it with guarantees to repay the loans.
===============
Because they have unions that the Republicans with the help of the news media can bust using lies about their wages, etc. Americans are the world's dumbest thanks to the news media we have. Say "the media is liberal" four times and the American parakeets will repeat it despite what they see and hear right before their eyes. Pathetic.

Perhaps you missed an event that happened last November. This event ushered in a democrat near super majority in both chambers and a democrat president. Republicans are a sideshow right now and cant do squat. If you are complaining about the above, complain to the democrats as they hold the power.

You no doubt missed my feature article of the day:

http://forums.anandtech.com/me...=2283145&enterthread=y

I don't blame you for being brainwashed by the universal Republican controlled corporate media. Most people are.


And what exactly does that have to do with bailing out the auto companies?

Are you unable to read your own posts? Here, I'll help you by cutting and pasting from your own post (that is actually right above here, but perhaps confusing to you due to word congestion)

"Perhaps you missed an event that happened last November. This event ushered in a democrat near super majority in both chambers and a democrat president. Republicans are a sideshow right now and cant do squat. If you are complaining about the above, complain to the democrats as they hold the power"

Genx87


Now go read my article since you obviously just read the title instead of the content.



 

K1052

Elite Member
Aug 21, 2003
52,368
45,813
136
The government should continue to support GM but it's time for Chrysler to call it a day. The feds should finance it's bankruptcy and fold any profitable lines into GM as a condition of further support. If GM can successfully swap a good chunk of it's debt for equity they could make it.

Allowing GM to founder in the economy's current state is not in any way acceptable regardless of the 'moral hazard' that exists.
 

tvarad

Golden Member
Jun 25, 2001
1,130
0
0
Originally posted by: Moonbeam
These, 'I have the economic issues figured out' threads look to me like attempts to manage fear, much like when we replay and replay some traumatic event in our head, compulsively. I sense a need to be in control and the horrible fear that our fate is out of our hands. The beauty of say, Islam, is the notion that all that happens is the will of God and that a good man has nothing to fear, in this life, or the next. The wind that blows, the sun that warms my skin, the birds that land in my yard are all free and don't care about the economy and I am rich beyond measure.

I prefer sticking my head in the sand personally but hey, different strokes for different folks.