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Old 11-20-2008, 03:23 PM   #41
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Yes, TARP is a joke, and now the lawmakers are so pissed off they are refusing to keep an open mind about the domestic auto industry.

I just don't understand how TARP/Paulson can justify spending 140B on one insurance company but not 25B on three huge auto makers. Everyone rags on the detriot CEOs for being out of touch and having a crappy business model. Well, how good was AIG's model? It really looks to me like people just taking care of their own. Wall Street has always looked down on the domestic auto makers.
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Old 11-20-2008, 03:40 PM   #42
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Originally Posted by cardude View Post
Everyone rags on the detriot CEOs for being out of touch and having a crappy business model. Well, how good was AIG's model?
There was plenty of that when AIG was getting their bailout. They're now under constant scrutiny (as they should be) to the point where if their execs stay anywhere but a Motel 6, congress is calling for them to resign. Also, I don't think anyone was claiming that AIG was doing things well prior to their bailout.
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Old 11-20-2008, 06:02 PM   #43
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Uninteresting. A lot of hand-wringing with no solution, the bailout forestalls the inevitable unless there are sweeping changes, and all we hear on that front is 'the UAW isn't giving up anything' and Wagoner 'is not resigning.' And if someone would explain how all domestic automakers, all their suppliers and all their dealers are going to fail - I'd love to hear it, that's never happened to any industry that I know of. Some will fail, and some will benefit as a result.

It's not that the rest of us don't sympathize, but most of us are also suffering the effects of this economy and there won't be a bailout for the rest of us. Our business is off 30%, and layoffs/closing will hit us within months if the economy doesn't turn around - doesn't look likely. So why should the rest of us making far less and having lost pensions and retiree health care long ago, bail out autoworkers who cost $73.20/hr (whether due to legacy benefits or not)?
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Old 11-21-2008, 12:23 PM   #44
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The general concept of a government-led Ch 11 has been on my mind for several months now, I'm glad the NYT finally agrees with me
But I wonder about a couple of the ideas in the article-
Is the typical UAW worker actually making $10-20/hr more than the foreign companies here? His next sentence suggests a confusion between pay and benefits, that's important because dealing with the problem requires a precise understanding of exactly what it is.
The government may be able to force the automakers to produce any kind of high-mileage vehicles the government desires, but Detroit's big problem has been that they are making vehicles the consumers don't want to buy. High-mileage might turn out to be another white elephant for years, until gas prices go up again.
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Old 11-21-2008, 12:34 PM   #45
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The government may be able to force the automakers to produce any kind of high-mileage vehicles the government desires, but Detroit's big problem has been that they are making vehicles the consumers don't want to buy. High-mileage might turn out to be another white elephant for years, until gas prices go up again.
Yep. Apparently, along with the bailout money, Detroit will also get the free assistance of the 535 highly talented auto engineers and marketeers of US Congress. As if the auto companies weren't in enough trouble. High mileage will be a requirement, I'm sure that 500 lbs of added safety enhancements will be in the cards, expect some requirements for "made in the US content" to be stuffed in there, a mandated percentage of ethanol-capable vehicles - - the design by committee will continue with each new tranche.

A smart exec would hasten to bankruptcy (to beat the rush), and get the company trim and ready to compete when the auto market turns around. Yes, he might get the ax, but at least he would have done the right thing. The dinosaurs will repeat the begging game to Congress, put up with the mandates, and slowly bleed to death in the international marketplace.

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Old 11-21-2008, 03:03 PM   #46
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Don't worry, the big three will now be able to compete with the Japanese and Korean auto makers:

UAW pushes for check card balloting

Hey, now they'll get all the Honda and Kia plants organized and make them pay $70/hour on labor costs, too! Nevermind the fact that a Civic will now cost 30k base.
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Old 11-21-2008, 03:03 PM   #47
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Not sure which of the many Auto Bailout threads to add this to, but I saw this one first, so you win/lose depending on POV:

Pelosi hopeful Big Three can show roadmap to 'viability' - MarketWatch
Quote:
Pelosi also rejected Chapter 11 bankruptcy as an alternative for the Big Three.

"I just think that would be digging a hole far too deep," she said, adding that such a scenario would prove devastating for workers, the economy and the U.S. manufacturing base.
I fail to understand how throwing tax money into what appears to be an unsustainable business model would NOT prove devastating for the economy.

What would have Pelosi done with the buggy-whip industry? I sure would like to be supporting them with my tax dollars

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