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Automotive News & Views Do You Favor A Government Loan To The Detroit 3?
3958 messages, Last post on Oct 02, 2009 at 4:52 PM
You are in the Automotive News & Views Forum. Your Hosts are steve_ & claires
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Replying to: gagrice (May 06, 2009 5:25 pm) You're mixing up two different situations. The shareholders of the current GM and Chrysler are last in line they get nothing. The shareholders of the new GM or Chrysler will have ownership of a much more vibrant, leaner and presumably agressive and profitable company. At some time in the future when this is proven and the markets restabilize somebody is going to want to buy these money machines. Then the UAW VEBA and the Feds sell off their ownership stakes and exit with cash in hand. When they talk about everybody taking a haircut this is one of the cuts that the UAW has to take. It has to take some risk in making the new entities strong, vibrant and profitable. PBGC only guarantees a portion of the pension for the retirees. Not the health care that is to be covered by VEBA. Again we are not playing by any legal precedence. This administration is shooting from the hip. Damn the constitution. This paragraph makes no sense whatsoever. It's childishness. You have 4 sentences that say nothing and the last the dumbest. What the hell are you talking about? What I wrote in relation to the PBGC is that one of the major benefits of saving GM and Chrysler is that the retirees are not dumped on the PBGC. That's it. What has that got to do with healthcare, legality and of all thing constitutionality. Logic please not emotionalism. You've must have Faux News, Rush and Savage mainlined into your arm everyday. Please don't tell me you get any of your views from any of those sources. They're all clowns and entertainers. |
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Replying to: gagrice (May 06, 2009 5:25 pm) Here's another false idea held by those not doing any research. The small group of hedgefunds are NOT investors that pensions are allowed to invest 401k or pensions in. In fact GM and Chrysler bonds being rated 'junk' are prohibitted from being part of any pension portfolio. What these hedgefunds do is invest small amounts of money for the uber-wealthy that want to gamble and don't have the time to go to Las Vegas. They take positions with a small part of the clients' portfolios in certain ultra-risky situations in order to hope to gain a shortterm windfall....then they get out. Just like playing craps. THIS is the group you feel sorry for? Get real. Research.... |
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Replying to: gagrice (May 06, 2009 5:33 pm) When the judge WSJ article rules then we'll have a valid legal opinion that carries some weight. Until then you, me and all the rest of your sources are only exercising our right of free speech and filling the air with gas. |
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One broke company buying another? Bankers and investors cause 5 million Americans to lose jobs buying and selling derivatives. Now there is a plan to save some of the D3 jobs that are still left and they don't want to play. The UAW has always thought they owned and controlled GM. Now they will have 39% of it. They finally will be getting pay tied to performance. That surely makes them angry. America is the land of safety nets. Now bondholders have to be named who didn't agree to deal. Wonder if they were The Foreign owned banks that sucked up $35 Billion in TARP money? |
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Let's not make it personal please. "GMAC won approval in December to become a bank holding company with greater access to state credit lines. The Treasury Department had injected six billion dollars to prevent its collapse. The rescue funds came from the Treasury's 700-billion-dollar Troubled Asset Relief Program and included a one-billion-dollar loan to GM. GMAC is owned by GM and Chrysler parent company Cerberus Capital Management, a private equity firm." GMAC posts wider earnings loss (AFP) That was yesterday. This is today: GMAC Said to Need $11.5 Billion in Capital After Test (Bloomberg)
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Replying to: steve_ (May 06, 2009 7:46 pm) I try not to. It is difficult when debating with people that think they no it all. And try to put you down or into a category with right wing talk show hosts. If you have fiscal conservative ideas in this day of Socialistic ideals you are automatically made out to be a demagogue. I did not agree with the bank bailouts. I don't agree with the auto bailouts. I think our last President, and current President are over stepping their bounds. And to discount a bond holder as some kind of lower class citizen is scary. If not for people with money taking chances on companies in this country we would be in deep trouble. So I believe in the protection of everyone's rights under OUR Constitution. Something our current administration has targeted to change. |
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Replying to: gagrice (May 06, 2009 8:31 pm) I agree with that. And to discount a bond holder as some kind of lower class citizen is scary. Well, sorry. If we blame Wagoner and his cronies for being idiots for steering sinking ships that were taking on water for >20 years, then anybody who invested in the debt of these companies could have seen the iceberg. All you had to do is look at the balance sheet of GM to see the disaster looming. If the government had not stepped in the bondholders would have had $Billions less to split up. All that high interest-paying debt is that way for a reason. What I wonder about is why the ratings agencies (Moody's, etc.) didn't downgrade the credit sooner. Why didn't the ridiculously expensive Sarbanes-Oxley controls warn us that the D3 and especially the banks were all just houses of cards? That's where we should throw our ire. The bondholders of GM and C debt were idiots. They took their chances and lost.
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Replying to: gagrice (May 06, 2009 5:49 pm) No, they don't...TARP is also law. When bondholders saw them getting TARP money, they had every right to attempt to sell their holdings, knowing that they no longer had ultimate seniority. They knowing chose to take the risk. You're right about the responsibility of the lender...but in this case the federal government, acting on behalf of the taxpayer, is also a lender. Therefore they have that same responsibility to protect the investment of the taxpayers, don't they? Only in this case, it involves protecting every taxpayer, not just a select few hedge funds. Let me put it this way....if the bondholders get their way, and Chrysler liquidates in order to pay off their bonds with bailout money, what we have is redistribution of wealth from the ordinary taxpayer to hedge funds acting largely on the behalf of the wealthy. And frankly, I'm tired of covering investment losses for gamblers who decided afterward that they couldn't handle the risk.
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Replying to: gagrice (May 06, 2009 8:31 pm) That's the key phrase there...."taking chances." Taking chances and investing means running the risk of loss. There was always a possibility that Chrysler would default on the bonds...heck if it wasn't for bailout money, they would have long ago, and the bonds would be toilet paper. When the government (like it or not) enacted TARP legislation, it became law that those bailouts would be senior debt. This was written in specifically to prevent "wealth redistribution," the conservative buzz-word, only up instead of down. I think that's fair, since there shouldn't be any wealth redistribution, period.
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Automotive News & Views Do You Favor A Government Loan To The Detroit 3?
