Bail Out the Auto Industry

[GTKeeper]

Originally posted by: spidey07
When legislation/law is set to fail American workers (thanks Clinton) the product is what you see. So let's reverse that to make it a level playing field.

Wow you are so smart!

The problem is that SUVs and Trucks are not selling. Small foreign cars are. There is a waiting list for the Prius. Nice try to blame all this crap on Clinton. He actually GAVE money to the big 3 to develop a better car. They developed the EV - 1 but never seriously considered mass producing it... epic FAIL by the auto industry.

 

[BoberFett]

Originally posted by: LegendKiller

Originally posted by: chess9

Originally posted by: BoberFett

Originally posted by: chess9
I've changed my mind on this issue. Initially I was opposed, but after considering some of the consequences to our economy and tax base, to say nothing of the pain to the 3 million workers involved, I think we should give them a hand.

The problem with a bailout is properly managing it. Without concessions by labor and management, a viable business plan, and completely new management, I don't think a bailout would do anything but prolong the inevitable. I would give it ONE try.

-Robert

Everything that's happening right now is prolonging the inevitable. The current model of the US economy is unsustainable. It will collapse, and it will be big. It's just a matter of when.

So what the hell, let the printing presses roll. Let's have a big party while we still can. It's all going down the shitter.

I'm sorry to report that I can't say you are wrong.

-Robert

I always laugh at such dire predictions. Had we not gotten ridiculous with mortgages this wouldn't be an issue. That isn't a fundamental weakness, it's an event driven one, and something that can be overcome given time.

The US isn't ending and our economy is still the marquee economy of the world. We produce an amazing amount of ideas and products. To say that the current model is unsustainable is to ignore everything and focus only on the current event driven problem areas.

Bullshit. Consumers in the US are tapped out. There's nothing more fundamental than that.

There. Is. No. Money.

There never was. It was all phony wealth based on fake home values. Had we not gotten ridiculous with mortgages we'd have crashed years ago. Instead the mortgage boom coasted us on fumes for a few extra years.

Not only do I question your objectivity in the matter I'm starting to question your intelligence LK.

 

[bamacre]

Originally posted by: BoberFett

Originally posted by: LegendKiller

Originally posted by: chess9

Originally posted by: BoberFett

Originally posted by: chess9
I've changed my mind on this issue. Initially I was opposed, but after considering some of the consequences to our economy and tax base, to say nothing of the pain to the 3 million workers involved, I think we should give them a hand.

The problem with a bailout is properly managing it. Without concessions by labor and management, a viable business plan, and completely new management, I don't think a bailout would do anything but prolong the inevitable. I would give it ONE try.

-Robert

Everything that's happening right now is prolonging the inevitable. The current model of the US economy is unsustainable. It will collapse, and it will be big. It's just a matter of when.

So what the hell, let the printing presses roll. Let's have a big party while we still can. It's all going down the shitter.

I'm sorry to report that I can't say you are wrong.

-Robert

I always laugh at such dire predictions. Had we not gotten ridiculous with mortgages this wouldn't be an issue. That isn't a fundamental weakness, it's an event driven one, and something that can be overcome given time.

The US isn't ending and our economy is still the marquee economy of the world. We produce an amazing amount of ideas and products. To say that the current model is unsustainable is to ignore everything and focus only on the current event driven problem areas.

Bullshit. Consumers in the US are tapped out. There's nothing more fundamental than that.

There. Is. No. Money.

There never was. It was all phony wealth based on fake home values. Had we not gotten ridiculous with mortgages we'd have crashed years ago. Instead the mortgage boom coasted us on fumes for a few extra years.

Not only do I question your objectivity in the matter I'm starting to question your intelligence LK.

It isn't his intelligence that needs questioned, it is his objectivity.

Otherwise, :thumbsup: :thumbsup: .

 

[TheSlamma]

It's time for them to go. Yes I know it will pound our economy hard. But sometimes things have to hurt if they are to heal properly.

The US is better off building Honda's and Toyota's here WITHOUT unions

 

[Ktulu]

Originally posted by: TheSlamma
It's time for them to go. Yes I know it will pound our economy hard. But sometimes things have to hurt if they are to heal properly.

The US is better off building Honda's and Toyota's here WITHOUT unions

You see the problem with that statement is that not even Toyota or Honda will be able to build cars here because they will have no suppliers here in the US, GM would have taken everybody down with them.

 

[LegendKiller]

Originally posted by: BoberFett

Originally posted by: LegendKiller

Originally posted by: chess9

Originally posted by: BoberFett

Originally posted by: chess9
I've changed my mind on this issue. Initially I was opposed, but after considering some of the consequences to our economy and tax base, to say nothing of the pain to the 3 million workers involved, I think we should give them a hand.

The problem with a bailout is properly managing it. Without concessions by labor and management, a viable business plan, and completely new management, I don't think a bailout would do anything but prolong the inevitable. I would give it ONE try.

-Robert

Everything that's happening right now is prolonging the inevitable. The current model of the US economy is unsustainable. It will collapse, and it will be big. It's just a matter of when.

So what the hell, let the printing presses roll. Let's have a big party while we still can. It's all going down the shitter.

I'm sorry to report that I can't say you are wrong.

-Robert

I always laugh at such dire predictions. Had we not gotten ridiculous with mortgages this wouldn't be an issue. That isn't a fundamental weakness, it's an event driven one, and something that can be overcome given time.

The US isn't ending and our economy is still the marquee economy of the world. We produce an amazing amount of ideas and products. To say that the current model is unsustainable is to ignore everything and focus only on the current event driven problem areas.

Bullshit. Consumers in the US are tapped out. There's nothing more fundamental than that.

There. Is. No. Money.

There never was. It was all phony wealth based on fake home values. Had we not gotten ridiculous with mortgages we'd have crashed years ago. Instead the mortgage boom coasted us on fumes for a few extra years.

Not only do I question your objectivity in the matter I'm starting to question your intelligence LK.

The payment rate for credit card trusts is 20%. Per month. It is estimated that even with min pay credits, the trusts would be 90% paid down within a year and a half. Mortgages? Not that huge of a deal, most are 30yr.

US Consumers aren't perm. tapped out, it just isn't there. Short term, sure, for a year, at most two, but it will come back.

I'll make sure to bump this when the economy turns around, then I'll question your intelligence.

 

[Genx87]

Originally posted by: Ktulu

Originally posted by: TheSlamma
It's time for them to go. Yes I know it will pound our economy hard. But sometimes things have to hurt if they are to heal properly.

The US is better off building Honda's and Toyota's here WITHOUT unions

You see the problem with that statement is that not even Toyota or Honda will be able to build cars here because they will have no suppliers here in the US, GM would have taken everybody down with them.

Where would the suppliers go?

 

[Engineer]

Originally posted by: Genx87

Originally posted by: Ktulu

Originally posted by: TheSlamma
It's time for them to go. Yes I know it will pound our economy hard. But sometimes things have to hurt if they are to heal properly.

The US is better off building Honda's and Toyota's here WITHOUT unions

You see the problem with that statement is that not even Toyota or Honda will be able to build cars here because they will have no suppliers here in the US, GM would have taken everybody down with them.

Where would the suppliers go?

Many of the suppliers (like my company) supply ALL of the automotive industry. If enough of the supply business is through GM, Ford or Chrysler, it may be enough to break those suppliers. This isn't just about the big three, it's about hundreds or thousands of suppliers in the chain that could break if the big three go under.

 

[Moonbeam]

I believe the VW hit the US around 1957. It was inexpensive, reliable, and got good gas mileage. I also believe that the implications of the end of oil have been foretold, understood and anticipated since the early 1950's Let the auto companies die. They are not only incompetent, they have actively worked to destroy our nation by standing in the way of progress.

 

[LegendKiller]

Originally posted by: Moonbeam
I believe the VW hit the US around 1957. It was inexpensive, reliable, and got good gas mileage. I also believe that the implications of the end of oil have been foretold, understood and anticipated since the early 1950's Let the auto companies die. They are not only incompetent, they have actively worked to destroy our nation by standing in the way of progress.

The US consumer has held the US back. Companies build and sell what consumers want, not the other way around.

 

[bamacre]

Originally posted by: LegendKiller

Originally posted by: Moonbeam
I believe the VW hit the US around 1957. It was inexpensive, reliable, and got good gas mileage. I also believe that the implications of the end of oil have been foretold, understood and anticipated since the early 1950's Let the auto companies die. They are not only incompetent, they have actively worked to destroy our nation by standing in the way of progress.

The US consumer has held the US back. Companies build and sell what consumers want, not the other way around.

:laugh: You can't be serious.

 

[Genx87]

Originally posted by: Engineer

Originally posted by: Genx87

Originally posted by: Ktulu

Originally posted by: TheSlamma
It's time for them to go. Yes I know it will pound our economy hard. But sometimes things have to hurt if they are to heal properly.

The US is better off building Honda's and Toyota's here WITHOUT unions

You see the problem with that statement is that not even Toyota or Honda will be able to build cars here because they will have no suppliers here in the US, GM would have taken everybody down with them.

Where would the suppliers go?

Many of the suppliers (like my company) supply ALL of the automotive industry. If enough of the supply business is through GM, Ford or Chrysler, it may be enough to break those suppliers. This isn't just about the big three, it's about hundreds or thousands of suppliers in the chain that could break if the big three go under.

Break? I would expect a downsizing while GM is in bankruptcy or the foreign companies pikc up production. Every industry has this ripple effect. Doesnt mean we need to prop up failed business because of this effect.

 

[L00PY]

It's interesting reading peoples' arguments that there should be a bailout because of the size of the industry, that it's due to the current economic situation, or because of the number of people employed. I'm reminded of David Frum's piece where he said, "Casino gambling directly employs more people than the domestic automobile industry. Add in the supply chain for both industries, and casinos still employ almost half as many people as the automobile sector." The AGA has statistics for employment and revenue that reinforce this point. If you stand by the reasoning given for an auto bailout, and given the threat of bankruptcy to the Las Vegas Sands Corporation and others, is a gaming industry bailout warranted too?

 

[chess9]

Originally posted by: Jiggz

Originally posted by: chess9
I've changed my mind on this issue. Initially I was opposed, but after considering some of the consequences to our economy and tax base, to say nothing of the pain to the 3 million workers involved, I think we should give them a hand.

The problem with a bailout is properly managing it. Without concessions by labor and management, a viable business plan, and completely new management, I don't think a bailout would do anything but prolong the inevitable. I would give it ONE try.

-Robert

I wonder if you had followed up on the bailout or loan (whatever they call it now) extended to AIG? Remember it started off with $85B, then AIG partied the entire company in LA for a quarter $1M. The following month, the gov't extended yet another $150B to keep AIG solvent! And believe it or not AIG has not even started yet!

Sure the auto industry is only asking $25B, and believe it or not that's only a starter. The way these industries and UAW are married and operate together, I doubt they can turn around and be in the black within the next three years and most especially with only a couple of $B's of dollars.

I feel your pain! That's why they need to tie Detroit up into about 1,000 small knots. They should make Torquemada look like an amateur. Is Congress up to the task of overseeing the lending of billions? LOL! Probably NOT.

-Robert

 

[BoberFett]

Originally posted by: LegendKiller

Originally posted by: BoberFett

Originally posted by: LegendKiller

Originally posted by: chess9

Originally posted by: BoberFett

Originally posted by: chess9
I've changed my mind on this issue. Initially I was opposed, but after considering some of the consequences to our economy and tax base, to say nothing of the pain to the 3 million workers involved, I think we should give them a hand.

The problem with a bailout is properly managing it. Without concessions by labor and management, a viable business plan, and completely new management, I don't think a bailout would do anything but prolong the inevitable. I would give it ONE try.

-Robert

Everything that's happening right now is prolonging the inevitable. The current model of the US economy is unsustainable. It will collapse, and it will be big. It's just a matter of when.

So what the hell, let the printing presses roll. Let's have a big party while we still can. It's all going down the shitter.

I'm sorry to report that I can't say you are wrong.

-Robert

I always laugh at such dire predictions. Had we not gotten ridiculous with mortgages this wouldn't be an issue. That isn't a fundamental weakness, it's an event driven one, and something that can be overcome given time.

The US isn't ending and our economy is still the marquee economy of the world. We produce an amazing amount of ideas and products. To say that the current model is unsustainable is to ignore everything and focus only on the current event driven problem areas.

Bullshit. Consumers in the US are tapped out. There's nothing more fundamental than that.

There. Is. No. Money.

There never was. It was all phony wealth based on fake home values. Had we not gotten ridiculous with mortgages we'd have crashed years ago. Instead the mortgage boom coasted us on fumes for a few extra years.

Not only do I question your objectivity in the matter I'm starting to question your intelligence LK.

The payment rate for credit card trusts is 20%. Per month. It is estimated that even with min pay credits, the trusts would be 90% paid down within a year and a half. Mortgages? Not that huge of a deal, most are 30yr.

US Consumers aren't perm. tapped out, it just isn't there. Short term, sure, for a year, at most two, but it will come back.

I'll make sure to bump this when the economy turns around, then I'll question your intelligence.

When that time comes I'll happily welcome your derision. Whether the economy bounces back or I'm right and it fails, either way I win.

 

[chess9]

Originally posted by: LegendKiller

Originally posted by: Moonbeam
I believe the VW hit the US around 1957. It was inexpensive, reliable, and got good gas mileage. I also believe that the implications of the end of oil have been foretold, understood and anticipated since the early 1950's Let the auto companies die. They are not only incompetent, they have actively worked to destroy our nation by standing in the way of progress.

The US consumer has held the US back. Companies build and sell what consumers want, not the other way around.

Except the Japanese LED THE CONSUMER. They started 40 years ago. Same with the Germans 60 years ago. Technology leads, it never follows. The American auto industry has followed the consumer around like some forelorn lover hoping to win her back. Just piss poor management since about 1960.

-Robert

 

[Engineer]

Originally posted by: Genx87

Originally posted by: Engineer

Originally posted by: Genx87

Originally posted by: Ktulu

Originally posted by: TheSlamma
It's time for them to go. Yes I know it will pound our economy hard. But sometimes things have to hurt if they are to heal properly.

The US is better off building Honda's and Toyota's here WITHOUT unions

You see the problem with that statement is that not even Toyota or Honda will be able to build cars here because they will have no suppliers here in the US, GM would have taken everybody down with them.

Where would the suppliers go?

Many of the suppliers (like my company) supply ALL of the automotive industry. If enough of the supply business is through GM, Ford or Chrysler, it may be enough to break those suppliers. This isn't just about the big three, it's about hundreds or thousands of suppliers in the chain that could break if the big three go under.

Break? I would expect a downsizing while GM is in bankruptcy or the foreign companies pikc up production. Every industry has this ripple effect. Doesnt mean we need to prop up failed business because of this effect.

I didn't really comment on whether it shoud be done or not. Just commenting that the suppliers are interwoven with the industry and if key suppliers fail (remember sales are down and suppliers are in big trouble too), it could ripple throughout the industry, both domestically owned and foreigned owned automotive companies alike having supply or shutdown issues.

 

[Genx87]

Originally posted by: Engineer

Originally posted by: Genx87

Originally posted by: Engineer

Originally posted by: Genx87

Originally posted by: Ktulu

Originally posted by: TheSlamma
It's time for them to go. Yes I know it will pound our economy hard. But sometimes things have to hurt if they are to heal properly.

The US is better off building Honda's and Toyota's here WITHOUT unions

You see the problem with that statement is that not even Toyota or Honda will be able to build cars here because they will have no suppliers here in the US, GM would have taken everybody down with them.

Where would the suppliers go?

Many of the suppliers (like my company) supply ALL of the automotive industry. If enough of the supply business is through GM, Ford or Chrysler, it may be enough to break those suppliers. This isn't just about the big three, it's about hundreds or thousands of suppliers in the chain that could break if the big three go under.

Break? I would expect a downsizing while GM is in bankruptcy or the foreign companies pikc up production. Every industry has this ripple effect. Doesnt mean we need to prop up failed business because of this effect.

I didn't really comment on whether it shoud be done or not. Just commenting that the suppliers are interwoven with the industry and if key suppliers fail (remember sales are down and suppliers are in big trouble too), it could ripple throughout the industry, both domestically owned and foreigned owned automotive companies alike having supply or shutdown issues.

I agree there will definately be a hit on the suppliers. But I dont think they would go away as the person I replied to said.

 

[Engineer]

Originally posted by: Genx87

I agree there will definately be a hit on the suppliers. But I dont think they would go away as the person I replied to said.

From the internal numbers I've seen, quite a few could just quit or move out of North America alltogether. The rest of the world is in pretty good shape and many suppliers are making money elsewhere. Here in North America, the supplier industry is in dire straights. My company has been ahead of the curve and isn't in nearly as bad a shape as many others are, but we are still struggling and it's getting worse, not better. Time will tell though.

 

[dmcowen674]

Originally posted by: LegendKiller
The payment rate for credit card trusts is 20%. Per month. It is estimated that even with min pay credits, the trusts would be 90% paid down within a year and a half. Mortgages? Not that huge of a deal, most are 30yr.

US Consumers aren't perm. tapped out, it just isn't there. Short term, sure, for a year, at most two, but it will come back.

I'll make sure to bump this when the economy turns around, then I'll question your intelligence.

?

Most credit cards have run up to 32%, where do you get this 20%?

 

[mooseracing]

Don't worry Obama wants to bail out the Original Big 3 no matter what. The article I was reading on google news with his latest interview, he said "No matter what we have to bail them out, lets forget about the national deficit for a couple years and bailout the big 3"....

As much as I am loyal....capitalism is capitalism, let it take its course.

 

[LegendKiller]

Originally posted by: dmcowen674

Originally posted by: LegendKiller
The payment rate for credit card trusts is 20%. Per month. It is estimated that even with min pay credits, the trusts would be 90% paid down within a year and a half. Mortgages? Not that huge of a deal, most are 30yr.

US Consumers aren't perm. tapped out, it just isn't there. Short term, sure, for a year, at most two, but it will come back.

I'll make sure to bump this when the economy turns around, then I'll question your intelligence.

?

Most credit cards have run up to 32%, where do you get this 20%?

Payment rate, as in principal payment rate. WAC on most of the portfolios are nowhere near 32%, you can find this out quite easily. For example, Capital One's master trust (COMET, Capital One Master Execution Trust) posts it's ABS investor report on the RegAB website, which shows that WAC is nowhere near 32%.

Those RegAB websites can be found for any public credit card company, none show 32%.

Perhaps you should educate yourself a bit more Dave.

 

[palehorse]

Absolutely not.

Like TWA, DHL, and a million other companies over the years, they can file Chapter 11, reorganize, and come back with a more efficient and effective business plan sometime in the future. If that means that some people lose their jobs, then so be it.

Unlike the bailout of the banks, there would be no monetary return on the "investment." IOW, we, the people, will never get the money back.

Fuck that.

 

[Engineer]

Originally posted by: palehorse
Absolutely not.

Like TWA, DHL, and a million other companies over the years, they can file Chapter 11, reorganize, and come back with a more efficient and effective business plan sometime in the future. If that means that some people lose their jobs, then so be it.

Unlike the bailout of the banks, there would be no monetary return on the "investment." IOW, we, the people, will never get the money back.

Fuck that.

It's estimated that if "one" of the big three fail, the US government will lose nearly 50 billion per year in tax revenue, FWIW.

 

[sandorski]

Let Chrysler Die, Bailout GM/Ford. On another Board discussing Chinese made Electric vehicles being soon Imported into Canada, I suggested that the Canadian Government should Buy some Idle Factories of the Big 3 as part of a Bailout. The reason would be to offer existing Canadian Electirc Vehicle companies to use the idle Factories to produce their vehicles in greater quantity. Something similar could be done in the US, you have plenty of companies out there with reasonably advanced designs, but little $$ to setup the Manufacturing capacity needed to be a serious contender. Might have to adjust Laws/Regulattions for that to succeed and certainly is a risk, but the change has to happen sooner or later and losing all those Jobs at this time would turn a very bad situation into a disaster.