Comments on: The bankruptcy-by-some-other-name solution at GM http://curiouscapitalist.blogs.time.com/2008/11/18/the-bankruptcy-by-some-other-name-solution-at-gm/ Commentary on the economy, the markets, and business Sat, 28 Nov 2009 16:55:17 +0000 http://wordpress.com/ hourly 1 By: curmudgeon57 http://curiouscapitalist.blogs.time.com/2008/11/18/the-bankruptcy-by-some-other-name-solution-at-gm/comment-page-1/#comment-11996 curmudgeon57 Wed, 19 Nov 2008 04:17:08 +0000 http://timecuriouscapitalist.wordpress.com/?p=3196#comment-11996 Okay, I haven't heard any news outlet say this, but I think someone has to. If you're looking for intellectually dishonest, look first to Bill Ford. Since he became chairman of Ford (I think 1999), along with the pitiful attempt at CEO, he did little but sing the mantra of the green car company, and said that that was his mission at Ford. Instead, his was the Ford that brought us the largest SUV on the market, and the Ford that sold more trucks than they did passenger cars. - And when Waggoner got up in front of Congress and bragged about how the innovative GM was launching nine hybrids next year, why did not one of our elected representatives ask him how many years he was behind the market leader? - I hate being so negative, but I can see nothing good coming our of the domestic auto industry. If there were ever an industry that deserved to crash and burn, this is it. Okay, I haven't heard any news outlet say this, but I think someone has to. If you're looking for intellectually dishonest, look first to Bill Ford. Since he became chairman of Ford (I think 1999), along with the pitiful attempt at CEO, he did little but sing the mantra of the green car company, and said that that was his mission at Ford. Instead, his was the Ford that brought us the largest SUV on the market, and the Ford that sold more trucks than they did passenger cars.
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And when Waggoner got up in front of Congress and bragged about how the innovative GM was launching nine hybrids next year, why did not one of our elected representatives ask him how many years he was behind the market leader?
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I hate being so negative, but I can see nothing good coming our of the domestic auto industry. If there were ever an industry that deserved to crash and burn, this is it.

]]> By: banzai7 http://curiouscapitalist.blogs.time.com/2008/11/18/the-bankruptcy-by-some-other-name-solution-at-gm/comment-page-1/#comment-11994 banzai7 Wed, 19 Nov 2008 02:06:59 +0000 http://timecuriouscapitalist.wordpress.com/?p=3196#comment-11994 Baby Can You Bail Our Cars (Baby You Can Drive My Car, The Beatles) WilliamBanzai7 Asked a politico what he wants us Big 3 to be He said baby, its so clear can't you see We want fuel efficiency instead of giant SUVs But it seems you can’t even do something in between Baby can you bail our cars Yes they’re a bunch of gas guzzling discards Baby can you bail our cars And maybe we’ll love you We told Congress that our prospects were good And they said really?, it's not well understood Manufacturing petrol pigs is not very fine Can you show us a better time Baby can you bail our cars Yes we need a new fresh start Baby can you bail our cars And maybe we'll love you Beep beep'm beep beep yeah We told told those D.C. lards we can start right away They said listen we got something to say You got no fuel efficient cars and it's breaking our hearts But here’s a bailout dollar and that's a start Baby can you bail our cars Yes we want a new fresh start Baby you can bail our cars And maybe we’ll love you Beep beep'm beep beep yeah Beep beep'm beep beep yeah Beep beep'm beep beep yeah Beep beep'm beep beep yeah Baby Can You Bail Our Cars
(Baby You Can Drive My Car, The Beatles)
WilliamBanzai7

Asked a politico what he wants us Big 3 to be
He said baby, its so clear can't you see
We want fuel efficiency instead of giant SUVs
But it seems you can't even do something in between

Baby can you bail our cars
Yes they're a bunch of gas guzzling discards
Baby can you bail our cars
And maybe we'll love you

We told Congress that our prospects were good
And they said really?, it's not well understood
Manufacturing petrol pigs is not very fine
Can you show us a better time

Baby can you bail our cars
Yes we need a new fresh start
Baby can you bail our cars
And maybe we'll love you

Beep beep'm beep beep yeah

We told told those D.C. lards we can start right away
They said listen we got something to say
You got no fuel efficient cars and it's breaking our hearts
But here's a bailout dollar and that's a start

Baby can you bail our cars
Yes we want a new fresh start
Baby you can bail our cars
And maybe we'll love you

Beep beep'm beep beep yeah
Beep beep'm beep beep yeah
Beep beep'm beep beep yeah
Beep beep'm beep beep yeah

]]> By: gmalcolms http://curiouscapitalist.blogs.time.com/2008/11/18/the-bankruptcy-by-some-other-name-solution-at-gm/comment-page-1/#comment-11993 gmalcolms Wed, 19 Nov 2008 00:40:26 +0000 http://timecuriouscapitalist.wordpress.com/?p=3196#comment-11993 byranfromhouston, But GM has already succeeded in offloading its underfunded pension liabilities to the UAW and has won other concessions on lower wages/benefits for new hires. Moreover, its international subsidiaries (especially in BRICs) are doing very well. As Justin points out, if GM can get out from under its mountain of debt with govt assistance those legacy issues with be passed. BTW, I like GMerdämmerung, too, for what it's worth. byranfromhouston,
But GM has already succeeded in offloading its underfunded pension liabilities to the UAW and has won other concessions on lower wages/benefits for new hires. Moreover, its international subsidiaries (especially in BRICs) are doing very well. As Justin points out, if GM can get out from under its mountain of debt with govt assistance those legacy issues with be passed.

BTW, I like GMerdämmerung, too, for what it's worth.

]]> By: bryanfromhouston http://curiouscapitalist.blogs.time.com/2008/11/18/the-bankruptcy-by-some-other-name-solution-at-gm/comment-page-1/#comment-11984 bryanfromhouston Tue, 18 Nov 2008 19:05:40 +0000 http://timecuriouscapitalist.wordpress.com/?p=3196#comment-11984 Omega, - But how do we deal with the largest source of anti-competitiveness within the Big 3?? --The Legacy Costs-- I just think the Republican approach is probably right but there discussion is intellectually dishonest. - The reason Toyota and Honda are doing better is they don't have the legacy costs. Those costs WILL ultimately be paid by the taxpayer. The question is do we want to do it with the possibility of getting the money back or just paying out in Pension Guaranty and Medicare/Medicaid Funds. Some adult has to sit down and run the numbers. After that, they have to say this is the best way out of this debacle. - Short of that. The talking heads on the Hill are going be different ones that just blab the same stuff. Omega,
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But how do we deal with the largest source of anti-competitiveness within the Big 3?? --The Legacy Costs-- I just think the Republican approach is probably right but there discussion is intellectually dishonest.
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The reason Toyota and Honda are doing better is they don't have the legacy costs. Those costs WILL ultimately be paid by the taxpayer. The question is do we want to do it with the possibility of getting the money back or just paying out in Pension Guaranty and Medicare/Medicaid Funds. Some adult has to sit down and run the numbers. After that, they have to say this is the best way out of this debacle.
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Short of that. The talking heads on the Hill are going be different ones that just blab the same stuff.

]]> By: 0megapart1cle http://curiouscapitalist.blogs.time.com/2008/11/18/the-bankruptcy-by-some-other-name-solution-at-gm/comment-page-1/#comment-11983 0megapart1cle Tue, 18 Nov 2008 18:59:16 +0000 http://timecuriouscapitalist.wordpress.com/?p=3196#comment-11983 I'm pretty sure they're much bigger than AIG, if you take into account all the suppliers and related companies they support with their business. I think a GM "conservatorship" is a good idea. Just giving GM money without strong rules put in place for how to spend it and a plan for success doesn't really make sense. As much as I hate to say it, I think I am more with Republicans than Democrats on this one. (No, we can't just let GM fail, as many Republicans are saying. We need to give them the money to succeed. But we need far more control over how that money is spent than Democrats are talking about requiring, and I think a conservatorship would provide that. I'm pretty sure they're much bigger than AIG, if you take into account all the suppliers and related companies they support with their business.

I think a GM "conservatorship" is a good idea. Just giving GM money without strong rules put in place for how to spend it and a plan for success doesn't really make sense. As much as I hate to say it, I think I am more with Republicans than Democrats on this one. (No, we can't just let GM fail, as many Republicans are saying. We need to give them the money to succeed. But we need far more control over how that money is spent than Democrats are talking about requiring, and I think a conservatorship would provide that.

]]> By: bryanfromhouston http://curiouscapitalist.blogs.time.com/2008/11/18/the-bankruptcy-by-some-other-name-solution-at-gm/comment-page-1/#comment-11982 bryanfromhouston Tue, 18 Nov 2008 18:54:22 +0000 http://timecuriouscapitalist.wordpress.com/?p=3196#comment-11982 Andy, - I think that the automakers are different in that the total cost is not quite as large as it was with the exposure to AIG. I may be wrong, but the numbers I have seen don't indicate that there are the astronomical numbers which say "Danger, Will Robinson, Danger!!" - Bankruptcy was created to respond to situations where a business goes insolvent. I'm not so certain that it is necessarily the best vehicle to deal with large interconnected industries which can bring on systemic collapse. - Ultimately, whether we are discussing government workouts (through some sort of conservatorship) or bankrupcty, we are looking at what will be fundamental changes to the industry. In any event, I don't think it is wise to make such decisions on the spare of the moment. - Ultimately, my hope is that GM, alone - Ford says they don't need it and Chrysler is the walking dead - can get a bridge loan. The loan will give enough time to look at the market, determine inefficiencies and reallocate resources in a smart way. Anything less and this will just be another TARP effort that we are not sure is actually working. - Btw, Justin, any thought to examining whether TARP is actually working? :-) Andy,
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I think that the automakers are different in that the total cost is not quite as large as it was with the exposure to AIG. I may be wrong, but the numbers I have seen don't indicate that there are the astronomical numbers which say "Danger, Will Robinson, Danger!!"
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Bankruptcy was created to respond to situations where a business goes insolvent. I'm not so certain that it is necessarily the best vehicle to deal with large interconnected industries which can bring on systemic collapse.
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Ultimately, whether we are discussing government workouts (through some sort of conservatorship) or bankrupcty, we are looking at what will be fundamental changes to the industry. In any event, I don't think it is wise to make such decisions on the spare of the moment.
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Ultimately, my hope is that GM, alone - Ford says they don't need it and Chrysler is the walking dead - can get a bridge loan. The loan will give enough time to look at the market, determine inefficiencies and reallocate resources in a smart way. Anything less and this will just be another TARP effort that we are not sure is actually working.
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Btw, Justin, any thought to examining whether TARP is actually working? :-)

]]> By: Andy from MA http://curiouscapitalist.blogs.time.com/2008/11/18/the-bankruptcy-by-some-other-name-solution-at-gm/comment-page-1/#comment-11979 Andy from MA Tue, 18 Nov 2008 17:32:31 +0000 http://timecuriouscapitalist.wordpress.com/?p=3196#comment-11979 Justin, what happens down the supply chain if GM or Ford,or Chrysler file for chapter 11? There hasn't been much ink written about this, but lots of blood will be spilled if they go bankrupt. Please tell me how the auto makers are any different from AIG? Justin, what happens down the supply chain if GM or Ford,or Chrysler file for chapter 11? There hasn't been much ink written about this, but lots of blood will be spilled if they go bankrupt. Please tell me how the auto makers are any different from AIG?

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