Boycotting the new GM.

[Bignate603]

Originally posted by: LTC8K6
Then what happened to the secured debtors if they went through a normal bankruptcy?

I think you mean secured creditors because in this case the debtor is GM. The creditors are the groups that are owed money by GM.

Like any case of chapter 11 bankruptcy the creditors go through the court to try and work out something for what they are owed. In this case I think they ended up with a 10% stake in the company.

 

[LTC8K6]

Yes, unsecured creditors got preference over secured creditors. This is no secret. Secured creditors were told to take the deal or else, and when they tried to assert their rights, they were bypassed and told they should have been happy being put in the back of the line instead of being cut out altogether. None of this is a secret. It was well covered in the media. Eventually most caved because they could not fight the battle.

This is not how a bankruptcy works.

 

[Bignate603]

Originally posted by: LTC8K6
Yes, unsecured creditors got preference over secured creditors. This is no secret. Secured creditors were told to take the deal or else, and when they tried to assert their rights, they were bypassed and told they should have been happy being put in the back of the line instead of being cut out altogether. None of this is a secret. It was well covered in the media. Eventually most caved because they could not fight the battle.

This is not how a bankruptcy works.

Actually, that's usually how it works out. This explanation from CNN does pretty well to explain the situation for secured creditors.

The "secured" creditors have howled the loudest. A misleading statement that often appears in the media is that "secured creditors are first in line in bankruptcy," with the implication that everyone else must stand aside. That's simply not true. A secured creditor is secured only to the extent of the money it can get for its collateral at a liquidation sale, and liquidation sales are notorious for producing lousy results. ("How much am I bid for a Chrysler SUV factory?") It is for just that reason that American bankruptcy laws try to avoid liquidation so that all creditors can benefit from the higher value a business has when it is a "going concern" rather than a corpse.

This is one of the advantages for the company in choosing chapter 11 over chapter 7. They're not bending the rules on bankruptcy, they chose to use chapter 11 because the company is worth more as a whole than after its been chopped up. The court allowed chapter 11 over chapter 7 because they felt that GM can emerge a viable company after they get through bankruptcy, though some would disagree with that decision.

Of course the creditors are screaming that they are being shorted. Each creditor was trying to get as much as they possibly could for their investment. In bankruptcy court that means you have to bitch and moan about how much more your loan is worth than everyone else's. They won't quit until they have no hope of getting anything else. This whole thing is typical of most chapter 11 bankruptcies where there are a ton of creditors and there isn't enough assets to cover debt. You can no longer cover everyone's loses so they're doing this mad scramble to try and recoup as much of their own loses as they can at the expense of everyone else.

 

[LTC8K6]

CNN?

http://www.southbendtribune.co...906070488/1064/Opinion

 

[Bignate603]

Originally posted by: LTC8K6
CNN?

http://www.southbendtribune.co...906070488/1064/Opinion

CNN's article

Here's who wrote that article for CNN...

Jay Westbrook is Benno C. Schmidt Chair of Business Law at the University of Texas at Austin. A bankruptcy scholar, he is co-author of "The Law of Debtors and Creditors," "As We Forgive Our Debtors: Bankruptcy and Consumer Credit in America," and "The Fragile Middle Class." He has served as a consultant to the International Monetary Fund and the World Bank.

Here's who wrote your article...

Brian Sikma is the press secretary for the St. Joseph County Republican Party.

His facebook page

I'll stick with CNN on this one...

 

[LTC8K6]

I am aware of who wrote the opinion piece, you knew it was opinion right?, and I am also aware of CNN's support of Obama.

Not everyone is under the spell.

The bankruptcies were crooked deals to help the UAW as far as I am concerned. It's pretty simple payback for help with the election. It's nothing new. It's setups for 2010 and 2012 support.

There's nothing I can do to make myself heard except buy from other car companies.

That's what I am going to do.

Had I been able to forsee these crooked deals and Govt/UAW/FIAT ownership of Chrysler, I never would have purchased my very expensive Jeep, even though I love it.

As far as I am concerned, GM and Chrysler do not exist anymore and I have no support for my Jeep.

Not that I had great support for it from Chrysler anyway, mind you...

When or if GM and Chrysler return from socialism, I will consider their cars again.

 

[SammyJr]

Originally posted by: KnightBreed

Originally posted by: SammyJr
Most new technologies are a hole at first. Then improvements are made. Economies of scale take over. I can see why you would be supportive of GM's former management. You're equally shortsighted.

The EV1 and it's next interations would have been a 10+ year black hole. What company is going to sink that much money into a program without any hope of ever turning a profit. It's not being shortsighted.

10+ year black hole, which means they'd have the tech working pretty damn well by now. Funding wouldn't have been an issue if they'd used some lobbying clout to get the U.S. Government to buy the vehicles for short range use. And even if not, they still would be years ahead of their competitors.

But no, GM's moronic management didn't look forward. They just looked for short-term profits. What a waste.

 

[LTC8K6]

10+ year black hole, which means they'd have the tech working pretty damn well by now.

They didn't throw away the technology. Just the poor implementation of it in the EV1.

If the EV1 were profitable, surely greed would have kept it going.

There was nothing to stop other car mfgs from duplicating the EV1 at the time with their own electric car.

Strangely, no other mfg saw a profit in it either.

 

[Mr.IncrediblyBored]

Originally posted by: SammyJr

Originally posted by: KnightBreed

Originally posted by: SammyJr
Most new technologies are a hole at first. Then improvements are made. Economies of scale take over. I can see why you would be supportive of GM's former management. You're equally shortsighted.

The EV1 and it's next interations would have been a 10+ year black hole. What company is going to sink that much money into a program without any hope of ever turning a profit. It's not being shortsighted.

10+ year black hole, which means they'd have the tech working pretty damn well by now. Funding wouldn't have been an issue if they'd used some lobbying clout to get the U.S. Government to buy the vehicles for short range use. And even if not, they still would be years ahead of their competitors.

But no, GM's moronic management didn't look forward. They just looked for short-term profits. What a waste.

GM gambled. Instead they dumped a ton of money into fuel cell development, which at the time they thought would be more viable than running off batteries. GM is right there with Honda leasing fuel cell prototypes to select markets.

Maybe they should lobby the government to buy a bunch of million dollar fuel cell prototypes instead! I mean the government doesn't waste enough money as it is. Seriously, are you of tax paying age yet?

And I'm going to assume by the lack of response regarding the labor contracts that you concede the point.

 

[NAC]

Originally posted by: Zenmervolt

Originally posted by: NAC
I'm confused by this discussion. I'm confused by the premise of boycotting a company which went BANKRUPT!

If the government didn't step in, GM would be liquidated and cease to exists other than, perhaps, brand names owned by other large companies.

That's simply not correct. GM would have filed Chapter 11, restructured, and would still be around.

Many, many airlines went bankrupt in the last two decades; some of them multiple times. They didn't end up liquidating assets or disappearing; they restructured and found ways to continue to operate. GM would have done the same.

I don't understand why so many people are laboring under the mistaken idea that companies just cease to exist when they file bankruptcy.

ZV

GM did file chapter 11, thanks to the 50 billion or whatever dollars the US government gave in life support to allow them to continue to function.

My understanding and belief is that GM needed a huge amount of cash like that in order to survive long enough to file chapter 11 and not be liquidated. There are no other suitors willing to a pay huge amount for the company (or several suitors each purchasing a large chunk for a portion of the huge amount). And there are no people or banks willing to lend them the huge amount. And without the cash, and with all the debt holders lined up at the door, chapter 11 could not be filed. Instead, the company would be forced to liquidate under chapter 7.

I'm no expert. But this isn't your average billion dollar company bankruptcy like an airline. This is a hundred billion dollar bankruptcy during a large recession and credit crunch of a company with a terrible debt to asset ratio in a sector which has like 50% overcapacity. That is why liquidation would have taken place without the US government involvement.

 

[Zenmervolt]

Originally posted by: NAC

Originally posted by: Zenmervolt

Originally posted by: NAC
I'm confused by this discussion. I'm confused by the premise of boycotting a company which went BANKRUPT!

If the government didn't step in, GM would be liquidated and cease to exists other than, perhaps, brand names owned by other large companies.

That's simply not correct. GM would have filed Chapter 11, restructured, and would still be around.

Many, many airlines went bankrupt in the last two decades; some of them multiple times. They didn't end up liquidating assets or disappearing; they restructured and found ways to continue to operate. GM would have done the same.

I don't understand why so many people are laboring under the mistaken idea that companies just cease to exist when they file bankruptcy.

ZV

GM did file chapter 11, thanks to the 50 billion or whatever dollars the US government gave in life support to allow them to continue to function.

My understanding and belief is that GM needed a huge amount of cash like that in order to survive long enough to file chapter 11 and not be liquidated. There are no other suitors willing to a pay huge amount for the company (or several suitors each purchasing a large chunk for a portion of the huge amount). And there are no people or banks willing to lend them the huge amount. And without the cash, and with all the debt holders lined up at the door, chapter 11 could not be filed. Instead, the company would be forced to liquidate under chapter 7.

I'm no expert. But this isn't your average billion dollar company bankruptcy like an airline. This is a hundred billion dollar bankruptcy during a large recession and credit crunch of a company with a terrible debt to asset ratio in a sector which has like 50% overcapacity. That is why liquidation would have taken place without the US government involvement.

I seriously doubt that GM would have been liquidated even if they had filed for bankruptcy prior to the bailout. They had so much debt compared to assets that it would not have made sense to liquidate (and, again, that's Chapter 7, not Chapter 11) because the company was clearly worth more as a going concern; especially given that foreign units remained rather profitable.

My view is that the bailout simply postponed the inevitable rather than creating any substantive difference in the eventual outcome.

ZV

 

[SearchMaster]

Originally posted by: Zenmervolt

Originally posted by: NAC

Originally posted by: Zenmervolt

Originally posted by: NAC
I'm confused by this discussion. I'm confused by the premise of boycotting a company which went BANKRUPT!

If the government didn't step in, GM would be liquidated and cease to exists other than, perhaps, brand names owned by other large companies.

That's simply not correct. GM would have filed Chapter 11, restructured, and would still be around.

Many, many airlines went bankrupt in the last two decades; some of them multiple times. They didn't end up liquidating assets or disappearing; they restructured and found ways to continue to operate. GM would have done the same.

I don't understand why so many people are laboring under the mistaken idea that companies just cease to exist when they file bankruptcy.

ZV

GM did file chapter 11, thanks to the 50 billion or whatever dollars the US government gave in life support to allow them to continue to function.

My understanding and belief is that GM needed a huge amount of cash like that in order to survive long enough to file chapter 11 and not be liquidated. There are no other suitors willing to a pay huge amount for the company (or several suitors each purchasing a large chunk for a portion of the huge amount). And there are no people or banks willing to lend them the huge amount. And without the cash, and with all the debt holders lined up at the door, chapter 11 could not be filed. Instead, the company would be forced to liquidate under chapter 7.

I'm no expert. But this isn't your average billion dollar company bankruptcy like an airline. This is a hundred billion dollar bankruptcy during a large recession and credit crunch of a company with a terrible debt to asset ratio in a sector which has like 50% overcapacity. That is why liquidation would have taken place without the US government involvement.

I seriously doubt that GM would have been liquidated even if they had filed for bankruptcy prior to the bailout. They had so much debt compared to assets that it would not have made sense to liquidate (and, again, that's Chapter 7, not Chapter 11) because the company was clearly worth more as a going concern; especially given that foreign units remained rather profitable.

My view is that the bailout simply postponed the inevitable rather than creating any substantive difference in the eventual outcome.

ZV

While this is probably too P&N-y, I really believe the latest round of bailouts were designed to give the UAW ownership of the companies and nothing else. Nobody could have been stupid enough to think that throwing fuel on an inferno would have put out the fire. I think Bush & Co. wasted the money in a last ditch effort to buy votes for his party, and (as said in this thread before) Obama & Co. wasted the money to pay back the unions.

 

[SammyJr]

Originally posted by: KnightBreed

Originally posted by: SammyJr

Originally posted by: KnightBreed

Originally posted by: SammyJr
Most new technologies are a hole at first. Then improvements are made. Economies of scale take over. I can see why you would be supportive of GM's former management. You're equally shortsighted.

The EV1 and it's next interations would have been a 10+ year black hole. What company is going to sink that much money into a program without any hope of ever turning a profit. It's not being shortsighted.

10+ year black hole, which means they'd have the tech working pretty damn well by now. Funding wouldn't have been an issue if they'd used some lobbying clout to get the U.S. Government to buy the vehicles for short range use. And even if not, they still would be years ahead of their competitors.

But no, GM's moronic management didn't look forward. They just looked for short-term profits. What a waste.

GM gambled. Instead they dumped a ton of money into fuel cell development, which at the time they thought would be more viable than running off batteries. GM is right there with Honda leasing fuel cell prototypes to select markets.

Maybe they should lobby the government to buy a bunch of million dollar fuel cell prototypes instead! I mean the government doesn't waste enough money as it is. Seriously, are you of tax paying age yet?

Again, managements fault. Which is easier? Generating electricity or creating hydrogen? Storing electricity or storing hydrogen safely? Stupid gamble.

The Government buys millions of vehicles anyway. They might as well buy some that are forward looking.

And I'm going to assume by the lack of response regarding the labor contracts that you concede the point.

No point in arguing this point with someone who thinks that GM's management couldn't possibly have negotiated a better deal with the Unions.

 

[Fenixgoon]

Originally posted by: SammyJr

Originally posted by: KnightBreed

Originally posted by: SammyJr

Originally posted by: KnightBreed

Originally posted by: SammyJr
Most new technologies are a hole at first. Then improvements are made. Economies of scale take over. I can see why you would be supportive of GM's former management. You're equally shortsighted.

The EV1 and it's next interations would have been a 10+ year black hole. What company is going to sink that much money into a program without any hope of ever turning a profit. It's not being shortsighted.

10+ year black hole, which means they'd have the tech working pretty damn well by now. Funding wouldn't have been an issue if they'd used some lobbying clout to get the U.S. Government to buy the vehicles for short range use. And even if not, they still would be years ahead of their competitors.

But no, GM's moronic management didn't look forward. They just looked for short-term profits. What a waste.

GM gambled. Instead they dumped a ton of money into fuel cell development, which at the time they thought would be more viable than running off batteries. GM is right there with Honda leasing fuel cell prototypes to select markets.

Maybe they should lobby the government to buy a bunch of million dollar fuel cell prototypes instead! I mean the government doesn't waste enough money as it is. Seriously, are you of tax paying age yet?

Again, managements fault. Which is easier? Generating electricity or creating hydrogen? Storing electricity or storing hydrogen safely? Stupid gamble.

The Government buys millions of vehicles anyway. They might as well buy some that are forward looking.

And I'm going to assume by the lack of response regarding the labor contracts that you concede the point.

No point in arguing this point with someone who thinks that GM's management couldn't possibly have negotiated a better deal with the Unions.

1) generating electricity and hydrogen are both easy. doing so in an economical fashion is completely different, *especially* on a commercial-scale product like a car where there are an incredible number of conflicting engineering interests.

2) storing hydrogen, logically, is easier because we already have a storage system for gasoline (just retrofit things - the infrastructure itself is there). on the other hand, aside from basic batteries, we have nothing that stores electricity on a large scale. we use it or we lose it.

3) it's quite easy for management to sign labor contracts when a strike will completely cripple their business. personally, i've always thought "well, just let them walk, then re-hire as non-union."

meritocracy FTW. quality workers deserve quality pay. those who aren't quality don't deserve quality pay. unions were necessary to rectify the horrid working conditions/pay. now, are they really all that necessary?

 

[LTC8K6]

IIRC, you cannot store or transport hydrogen in existing systems because hydrogen will leak right out of the tanks and piping. Hydrogen is a small molecule and will escape otherwise sealed systems.

Hydrogen embrittlement will also occur with steel tanks and pipes, so they have to bo coated against exposure.

So you basically can't use existing infrastructure for hydrogen.

 

[Corn]

Originally posted by: SammyJr
LOL. Prior to bankruptcy, GM was doing an awesome job making cars that people wanted. Oh wait.

Nearly 1 in 4 cars sold in the USA is manufactured by GM. They sell plenty of cars.

 

[woodie1]

Originally posted by: Corn

Originally posted by: SammyJr
LOL. Prior to bankruptcy, GM was doing an awesome job making cars that people wanted. Oh wait.

Nearly 1 in 4 cars sold in the USA is manufactured by GM. They sell plenty of cars.

True, and yet they couldn't turn a profit on that volume.

 

[Ktulu]

Originally posted by: woodie1

Originally posted by: Corn

Originally posted by: SammyJr
LOL. Prior to bankruptcy, GM was doing an awesome job making cars that people wanted. Oh wait.

Nearly 1 in 4 cars sold in the USA is manufactured by GM. They sell plenty of cars.

True, and yet they couldn't turn a profit on that volume.

Yup, like i said a few pages ago, even if GM's cars were class leaders they'd still be going through bankruptcy because they just couldn't turn a damn profit on them. Believe me, I admit that I'm a domestic fanboy but GM's problems ran deep and it wasn't all their products, at least not in recent years.

 

[Mr.IncrediblyBored]

Originally posted by: SammyJr

And I'm going to assume by the lack of response regarding the labor contracts that you concede the point.

No point in arguing this point with someone who thinks that GM's management couldn't possibly have negotiated a better deal with the Unions.

There goes management again, throwing more money at the employees. Just like the top brass to overpay their staff.

Maybe you think GM should have replaced the tens of thousands of employees at their assembly plants while the union strikes... oh, and replace the suppliers which are also UAW.

You are right about one thing, though. There is no point in arguing.

 

[Budmantom]

Originally posted by: JulesMaximus

Originally posted by: Robor

Originally posted by: Mermaidman
Why do the right-wingers want the US to fail? It'll be a self-fulfilling prophecy.

I wouldn't be surprised when they do something extreme against Obama.

What do you expect when half of them march to Rush's orders?

It's no secret that Rush hates America as do all his idiot minions.

Jules,

Haven't you been boycotting and bashing American cars for as long as you've been on this forum, does that make you an idiot?

GM sponsors Rush so it wouldn't make any sense for him to boycott his sponsor.


Jules I don't expect you to think for yourself and you don't.

 

[LOUISSSSS]

Originally posted by: Ktulu

Originally posted by: woodie1

Originally posted by: Corn

Originally posted by: SammyJr
LOL. Prior to bankruptcy, GM was doing an awesome job making cars that people wanted. Oh wait.

Nearly 1 in 4 cars sold in the USA is manufactured by GM. They sell plenty of cars.

True, and yet they couldn't turn a profit on that volume.

Yup, like i said a few pages ago, even if GM's cars were class leaders they'd still be going through bankruptcy because they just couldn't turn a damn profit on them. Believe me, I admit that I'm a domestic fanboy but GM's problems ran deep and it wasn't all their products, at least not in recent years.

agreed (maybe?)

probably because GM had to use more expensive upscale parts into their "regular" sedans just to be able to match the quality of competing foreign cars. then, they'd also have to match their price, which means losses. there was just no way GM could make a record-selling profitable car that can compete with the foreign. which is why they're bankrupt. of course, this is just my guess as to why they're bankrupt.