Deal reached on auto bailout

[Capt Caveman]

At least this time, some thought was put into this bailout as the auto companies will be forced to restructure. I'll be interested in hearing more details before deciding if this is a good thing.

Feds to lend $13.4 billion to automakers

WASHINGTON (CNN) -- The federal government will provide $13.4 billion in loans to Detroit automakers, the White House said Friday.

An additional $4 billion may be available in February, the Bush administration said.

"The terms and conditions of the financing provided by the Treasury Department will facilitate restructuring of our domestic auto industry, prevent disorderly bankruptcies during a time of economic difficulty, and protect the taxpayer by ensuring that only financially viable firms receive financing," according to a statement released by the White House.

The loans are designed to stabilize U.S. automakers through March 2009, at which time the automakers must show they are financially viable.

"If the firms have not attained viability by March 31, 2009, the loan will be called and all funds returned to the Treasury," the statement says.

Financing will be drawn from the $700 billion Troubled Asset Relief Program, it says.

 

[Genx87]

Pissing money down a toilet.

This will probably piss off the last 12% of people who approve of Bush.

 

[Capt Caveman]

Originally posted by: Genx87
Pissing money down a toilet.

This will probably piss off the last 12% of people who approve of Bush.

You know the Democrats are the ones that have been pushing for it. The Republicans have been against it.

 

[StageLeft]

"If the firms have not attained viability by March 31, 2009, the loan will be called and all funds returned to the Treasury," the statement says.

What? That's a joke, right?

 

[CADsortaGUY]

Originally posted by: Capt Caveman

Originally posted by: Genx87
Pissing money down a toilet.

This will probably piss off the last 12% of people who approve of Bush.

You know the Democrats are the ones that have been pushing for it. The Republicans have been against it.

Thus why he said it about Bush and not Republicans.

Anyway this bailout using TARP funds is :thumbsdown: Is there any way a plain old citizen would have standing to use the courts to block this?

 

[dullard]

Originally posted by: CADsortaGUY
Anyway this bailout using TARP funds is :thumbsdown: Is there any way a plain old citizen would have standing to use the courts to block this?

The TARP funds were signed into law. The TARP funds have virtually no restriction and can be spent on anything they want for any reason they want. Heck, they can give all $700 billion to pad the Bush family's wallet and it'll still be legal (don't worry, I'm 99% sure they won't try that). We really don't have much recourse now unless we can prove the TARP program is unconstitutional.

 

[Xavier434]

I had a feeling something like this was going to happen. Again, I can only hope for the best. March 31st of this year is going to be an interesting day.

 

[IceBergSLiM]

Whats 13 billion when compared to the 8.5 trillion figure being tossed around.

 

[Genx87]

Originally posted by: Skoorb

"If the firms have not attained viability by March 31, 2009, the loan will be called and all funds returned to the Treasury," the statement says.

What? That's a joke, right?

By then Obama will probably have crafted a longer term loan that wont have that restriction and will pay that off should it be called in.

 

[StageLeft]

.

 

[Dari]

ATPN Republicans against common sense? I'm SHOCKED! SHOCKED!

In other news, water is wet.

 

[CADsortaGUY]

Originally posted by: dullard

Originally posted by: CADsortaGUY
Anyway this bailout using TARP funds is :thumbsdown: Is there any way a plain old citizen would have standing to use the courts to block this?

The TARP funds were signed into law. The TARP funds have virtually no restriction and can be spent on anything they want for any reason they want. Heck, they can give all $700 billion to pad the Bush family's wallet and it'll still be legal (don't worry, I'm 99% sure they won't try that). We really don't have much recourse now unless we can prove the TARP program is unconstitutional.

I understand it was a rather vague TARP law but someone use the courts to stop some of this? Did the TARP really give Bush the authority to spend it as HE wishes? Seems pretty dumb of Democrats to give him that kind of power...

 

[SMOGZINN]

Wait a moment.

"protect the taxpayer by ensuring that only financially viable firms receive financing"

and

The loans are designed to stabilize U.S. automakers through March 2009, at which time the automakers must show they are financially viable."

It can't be both. Either we are giving the money to 'financially viable' firms, or we are not. How can you protect my tax money by ensuring that it only goes to financially viable firms if you give them the money now and ask them to prove they are viable in three months from now?

 

[CADsortaGUY]

Originally posted by: SMOGZINN
Wait a moment.

"protect the taxpayer by ensuring that only financially viable firms receive financing"

and

The loans are designed to stabilize U.S. automakers through March 2009, at which time the automakers must show they are financially viable."

It can't be both. Either we are giving the money to 'financially viable' firms, or we are not. How can you protect my tax money by ensuring that it only goes to financially viable firms if you give them the money now and ask them to prove they are viable in three months from now?

Shhh... obviously YOU are the one without "common sense" and Dari is just smarter that you...

 

[Xavier434]

Originally posted by: SMOGZINN
Wait a moment.

"protect the taxpayer by ensuring that only financially viable firms receive financing"

and

The loans are designed to stabilize U.S. automakers through March 2009, at which time the automakers must show they are financially viable."

It can't be both. Either we are giving the money to 'financially viable' firms, or we are not. How can you protect my tax money by ensuring that it only goes to financially viable firms if you give them the money now and ask them to prove they are viable in three months from now?

That specific part is a good thing. MUCH better than simply handing them the cash and closing the book. It is forcing them to reform and doing so is good for this economy if they are successful. I figure that if it is gonna happen then I will want to see stuff like this in the verbage.

 

[StageLeft]

Originally posted by: Xavier434

Originally posted by: SMOGZINN
Wait a moment.

"protect the taxpayer by ensuring that only financially viable firms receive financing"

and

The loans are designed to stabilize U.S. automakers through March 2009, at which time the automakers must show they are financially viable."

It can't be both. Either we are giving the money to 'financially viable' firms, or we are not. How can you protect my tax money by ensuring that it only goes to financially viable firms if you give them the money now and ask them to prove they are viable in three months from now?

That specific part is a good thing. MUCH better than simply handing them the cash and closing the book. It is forcing them to reform and doing so is good for this economy if they are successful. I figure that if it is gonna happen then I will want to see stuff like this in the verbage.

But to his point, I have no way to answer it; there is a conflicting provision that they have to be viable but in theory already are since that's how they receive the money.

 

[Dari]

Originally posted by: CADsortaGUY

Originally posted by: SMOGZINN
Wait a moment.

"protect the taxpayer by ensuring that only financially viable firms receive financing"

and

The loans are designed to stabilize U.S. automakers through March 2009, at which time the automakers must show they are financially viable."

It can't be both. Either we are giving the money to 'financially viable' firms, or we are not. How can you protect my tax money by ensuring that it only goes to financially viable firms if you give them the money now and ask them to prove they are viable in three months from now?

Shhh... obviously YOU are the one without "common sense" and Dari is just smarter that you...

Obviously it was a political statement. Do you really expect these politicians to know anything about finance/economics? Then again, people like you know nothing about the political economy.

 

[Ktulu]

Originally posted by: Skoorb

"If the firms have not attained viability by March 31, 2009, the loan will be called and all funds returned to the Treasury," the statement says.

What? That's a joke, right?

Everything I've read regarding the automakers financial viability is that would would not begin to be profitable again until about 2010 when the union concessions start to kick in. I'd really like to know why they chose this date. Just makes no sense.

 

[Schadenfroh]

Originally posted by: Ktulu

Originally posted by: Skoorb

"If the firms have not attained viability by March 31, 2009, the loan will be called and all funds returned to the Treasury," the statement says.

What? That's a joke, right?

Everything I've read regarding the automakers financial viability is that would would not begin to be profitable again until about 2010 when the union concessions start to kick in. I'd really like to know why they chose this date. Just makes no sense.

Text

Viability would mean that the companies must have a positive net present value, which doesn't necessarily mean immediate profitability but would require them to reach that point relatively soon, the official said.

 

[Dari]

Originally posted by: Ktulu

Originally posted by: Skoorb

"If the firms have not attained viability by March 31, 2009, the loan will be called and all funds returned to the Treasury," the statement says.

What? That's a joke, right?

Everything I've read regarding the automakers financial viability is that would would not begin to be profitable again until about 2010 when the union concessions start to kick in. I'd really like to know why they chose this date. Just makes no sense.

They chose that date for political expediency. It's the end of a financial quarter and the politicians wanted to sound professional. Besides, the clowns in the current Administration would be out by then so they really don't give a fuck.

 

[SMOGZINN]

Originally posted by: Dari

Originally posted by: CADsortaGUY

Originally posted by: SMOGZINN
Wait a moment.

"protect the taxpayer by ensuring that only financially viable firms receive financing"

and

The loans are designed to stabilize U.S. automakers through March 2009, at which time the automakers must show they are financially viable."

It can't be both. Either we are giving the money to 'financially viable' firms, or we are not. How can you protect my tax money by ensuring that it only goes to financially viable firms if you give them the money now and ask them to prove they are viable in three months from now?

Shhh... obviously YOU are the one without "common sense" and Dari is just smarter that you...

Obviously it was a political statement. Do you really expect these politicians to know anything about finance/economics? Then again, people like you know nothing about the political economy.

Yes, I do expect the people I give the purse strings of the world?s largest budget to should know at least the most basic principles of economics. Failing that be able to use simple logical deduction to realize that both of those statements can?t be true.

 

[Xavier434]

Originally posted by: Skoorb

Originally posted by: Xavier434

Originally posted by: SMOGZINN
Wait a moment.

"protect the taxpayer by ensuring that only financially viable firms receive financing"

and

The loans are designed to stabilize U.S. automakers through March 2009, at which time the automakers must show they are financially viable."

It can't be both. Either we are giving the money to 'financially viable' firms, or we are not. How can you protect my tax money by ensuring that it only goes to financially viable firms if you give them the money now and ask them to prove they are viable in three months from now?

That specific part is a good thing. MUCH better than simply handing them the cash and closing the book. It is forcing them to reform and doing so is good for this economy if they are successful. I figure that if it is gonna happen then I will want to see stuff like this in the verbage.

But to his point, I have no way to answer it; there is a conflicting provision that they have to be viable but in theory already are since that's how they receive the money.

Yes, there is a logical fallacy in the verbage there. I honestly don't care that much though. Their goal is clear and they are adding conditions in order to try and effectively reach that goal as well as toss in some insurance so to speak. That's pretty decent imo. That is being a lot more responsible with my tax dollars than simply handing it out and looking the other way.

 

[Dari]

Originally posted by: SMOGZINN

Originally posted by: Dari

Originally posted by: CADsortaGUY

Originally posted by: SMOGZINN
Wait a moment.

"protect the taxpayer by ensuring that only financially viable firms receive financing"

and

The loans are designed to stabilize U.S. automakers through March 2009, at which time the automakers must show they are financially viable."

It can't be both. Either we are giving the money to 'financially viable' firms, or we are not. How can you protect my tax money by ensuring that it only goes to financially viable firms if you give them the money now and ask them to prove they are viable in three months from now?

Shhh... obviously YOU are the one without "common sense" and Dari is just smarter that you...

Obviously it was a political statement. Do you really expect these politicians to know anything about finance/economics? Then again, people like you know nothing about the political economy.

Yes, I do expect the people I give the purse strings of the world?s largest budget to should know at least the most basic principles of economics. Failing that be able to use simple logical deduction to realize that both of those statements can?t be true.

They are the elected leaders you put in power. They are professional liars with time constraints. They only thing they're good at is spending other people's money. And the worst thing is you keep sending them back to the seats of power. So you are to blame, not them.

Want better leadership, elect better leaders.

 

[StageLeft]

Viability would mean that the companies must have a positive net present value, which doesn't necessarily mean immediate profitability but would require them to reach that point relatively soon, the official said.

I don't have a PHd, but can somebody please explain what "positive net present value" means because it sounds to me like horsh*t and not specific or quantifiable at all.

 

[Xavier434]

Originally posted by: Skoorb

Viability would mean that the companies must have a positive net present value, which doesn't necessarily mean immediate profitability but would require them to reach that point relatively soon, the official said.

I don't have a PHd, but can somebody please explain what "positive net present value" means because it sounds to me like horsh*t and not specific or quantifiable at all.

Start here:

Net present value