Edmunds.com | Inside Line | Auto Observer Your Account | Help | Directory
You are here:
![[F]](http://a332.g.akamai.net/f/332/936/12h/www.edmunds.com/media/townhall/webxicons/site.gif){kind=small}
Forums
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
|
Replying to: circlew (Nov 25, 2008 5:07 pm)
|
|
| ...if the Big Three just simply shut down for a year - meaning there would be few, if any 2009 models? Heck, things aren't even good for the imports with cars piling up on the docks. They could simply make a go of it with just their NA plants. I see the economy as a gluttonous person who has gorged for years on credit and now has severe indigestion. Let the economy digest what it has already eaten. | |
|
Replying to: tlong (Nov 25, 2008 9:26 pm) I stated a bunch of realities in my list of 7 items. You have not countered any of the 7 points with any truth. Seven tenths of one percent of unemployment increase in four years is disaster? Yes, with enough spin I guess! To spin the destruction of America and now hope to say it was contrived, we are really OK, is a bad plan. But it was the plan. $4 gas thew a tire iron in the spokes of that plan. The big 3 are hurt by $4 gas too. They are also hurt by the confidence killing plan that was contrived and executed against our country. Obama owes them the bailout because he got all the union vote and his 'It's the economy stupid' plan has caused their further demise. We have to spend our way out of the mess some say. We will have huge debts. W inherited the tech bubble burst when people carry stock losses onto their tax returns for years. It killed the budget along with 9-11 and the hurricanes. Now Obama inherits the mortgage meltdown and all that does to future federal revenue intake. He has made part of the mess and now has to figure out how to pull the plane out of the dive. For 2 years he kept yelling that the plane was in a dive. Now he's the pilot and the dive has become real. He was expecting the instruments to be found to be broken and the plane was actually climbing.
|
|
|
Replying to: lemko (Nov 26, 2008 5:41 am) It's not going to happen because fat cats covers and protects each other. If Joe Schmoe makes a financial mistake nobody will bailout him, but if CEO makes a financial mistake he gets medical insurance, pension & etc.
|
|
|
Replying to: ingvar (Nov 26, 2008 6:27 am)
|
|
|
Replying to: dave8697 (Nov 26, 2008 5:52 am) I don't have time to go thru your 7 points and verify the numbers, but I certainly give you the benefit of the doubt on most though, as you have a history of posting reliable and sensible views. But I will add that though you may be right on those, there are many indicators pointing to serious, serious problems. Without going into specifics as the holiday errands beckon, I would like to say that we've been thru several weekends lately where the Treasury and the President are on the phone on Sun. nights. Well it's the equivalent of the Cuban Missile Crisis. And when you see the Treasury offering $700B 2 months ago, and $800B the other day, and the Fed cutting interst rates below 1% (they can't go much lower!), I would say the financial folks are desperate. And on a personal basis, I know many people who need next week's paycheck to pay the bills. They no longer have any home equity. Their 401K is down 40%. Food is up 20% this year. And most people around here receive local tax bills that are 10% higher EACH YEAR. And very few people think they'll get the social security amount they are currently promised. If you still think the fundamentals are good, then I nominate you for Optimist of the Year. Ford, GM, and Chrysler need to sit down with the unions, suppliers and banks, and need to say "This is how much is coming in, and that's how much can go out; we need to adjust our budget to make that work."
|
|
|
Replying to: gagrice (Nov 26, 2008 5:31 am) I think you got it! I think the Big 3 would love to get out of their commitments in the U.S.A. They could make money if they were only producing and selling overseas. Of course, if they stick around and can collect another $25 billion, then why not! One other thought, why doesn't Mexico and Brazil come up with some of the $25 billion?
|
|
|
Replying to: lemko (Nov 26, 2008 6:40 am) It is perception of worth. The Disney board thought that Michael Ovitz was going to make them lots of money. He turned out to be a bumbling idiot with a good lawyer writing his contract. It cost Disney $140,000,000 to get rid of him. Franklin Raines as CEO, took $100s of millions in bonuses from Fannie Mae. Rather than have a scandal in that pseudo corporation they forced him to retire. He got to keep at least $110,000,000 of his ill got gains. Both examples are what our executives in this country have evolved into. I believe any company that receives tax dollars to survive should have automatic caps on salaries, bonuses and stock options. I liked McCain's idea that those executives would be limited to pay equal to the highest public offices.
|
|
|
Replying to: driver100 (Nov 26, 2008 7:21 am) I imagine they did give some kind of incentives to build there. Are they making money in those locations would be the question to ask? I know GM has asked Germany to bolster their Opel division. Canada has a lot to lose also with GM and Ford closing up shop. |
|
|
Replying to: tired_old_dave (Nov 25, 2008 11:43 am) This has been occurring since the early 1970s. It didn't start in 2000. tired_old_dave: While the fear is now deflation, how does keeping the printing presses working overtime not produce a debased currency and hyper-inflation or just ... Inflation occurs when too much money is chasing the same number of goods. So much wealth has evaporated over the past year that these injections of cash won't replace it. Recent actions of the federal government show that someone has learned from history - more specifically, the history of this country from 1929 to 1933. The stock market crash didn't cause the Great Depression. It was a necessary correction to rampant speculation in the stock market, which began around 1927. Several factors turned what should have been a short, sharp recession into the Great Depression. The first was the Hawley Smoot Tariff passed in 1930, which was designed to "protect" American industries, but ended up choking international trade. The market for American goods dried up, and the economic downturn spread to Europe. There was a thriving export market for American cars at this time (particularly for luxury marques like Packard and Cadillac), but foreign countries slammed that door shut in retaliation for the American passage of Hawley Smoot. The American manufacturers thus faced the loss of export markets at the same time that domestic demand was slackening. The second was a goverment concerned about inflation, when the real problem was deflation. The Federal Reserve choked off the money supply at a crucial time. It was akin to treating someone for a fever after he had frozen to death. This is why the government has been injecting cash into the economy. Another factor was a rising tax burden between 1929 and 1932. Note that even Obama has backed off on his plan to immediately repeal the Bush tax cuts (now his plan is to let them expire as scheduled), because he has advisers smart enough to realize that government should not raise taxes during an economic downturn. As for bailing out financial firms and not automakers - the simple fact is that financial firms are more important to the economy than, say, General Motors. Again, our government has learned from history. The collapse of several financial institutions during the early 1930s was a significant factor in worsening the economic downturn. That is not to say that more oversight shouldn't accompany the government aid. At this point, the best option for General Motors is some sort of pre-packaged, government-approved bankruptcy plan that allows the company to use the tools available in a bankruptcy filing to cut costs and slim down without an actual filing, which would scare away customers.
|
|
You are here:
Forums
Automotive News & Views Do You Favor A Government Loan To The Detroit 3?
