American Auto Makers

[jgalt]

Nov 17, 2008 14:00:30 GMT -5 Bando said:

Nov 17, 2008 13:46:18 GMT -5 jgalt said:

Dont want to get off of the this incredibly banal topic, but i thought obama wasnt a socialist?

He's not, unless you're defining socialism down to include George W. Bush, Richard Nixon, FDR, Ronald Reagan, Milton Friedman, and any sort of government intervention in the economy.

I am.

[SFHoya99]

If I'm going to invest money in the US Economy, I'd rather rebuild the infrastructure -- roads, power, rail, etc., and invest there than put it into the hands of executives proven to be incapable of turning around the Big 3.

They'd be back in a few years. If there was a radical solution proposed by them that required investment -- maybe I'd be for that -- but this is a supplement for more of the same.

You need to have something for the laid off employees -- a way for them to move to another job, and a safety net for the interim. But I don't think it is sustainable in the current business model.

On the other hand, it's a real issue for our economy and our defense if manufacturing goes by the wayside in the U.S. I just don't know how to solve the problem. We can't just keep paying each other for services.

[FewFAC]

If Wall Street is "sustainable," then I fail to see how Detroit is "unsustainable." To be fair, I don't think either is sustainable, however Washington has to date had little discipline to refrain from what amounts to pork barrel in doling out $350B to financial firms, so it has opened the Pandora's box of moral hazard, without yet defining what precisely separates the "too big to fail" from the shark bait.

Personally, I could get behind a bridge loan contingent upon bankruptcy restructuring with the government bailout essentially serving as DIP financing that will be impossible to attain from the commercial banks and that would be essential to moving the automakers from bankruptcy, through design, manufacturing and sales of new products.

The problem is to regain the trust of consumers and wait out the credit crisis preventing consumers from obtaining loans to purchase new vehicles could be a much longer term horizon than even $25B could do even if Detroit did everything right.

[HealyHoya]

Nov 17, 2008 21:24:40 GMT -5 FewFAC said:

If Wall Street is "sustainable," then I fail to see how Detroit is "unsustainable." To be fair, I don't think either is sustainable, however Washington has to date had little discipline to refrain from what amounts to pork barrel in doling out $350B to financial firms, so it has opened the Pandora's box of moral hazard, without yet defining what precisely separates the "too big to fail" from the shark bait.

Personally, I could get behind a bridge loan contingent upon bankruptcy restructuring with the government bailout essentially serving as DIP financing that will be impossible to attain from the commercial banks and that would be essential to moving the automakers from bankruptcy, through design, manufacturing and sales of new products.

The problem is to regain the trust of consumers and wait out the credit crisis preventing consumers from obtaining loans to purchase new vehicles could be a much longer term horizon than even $25B could do even if Detroit did everything right.

I would agree with the second paragraph above if we added to that new terms with the UAW. Yes, I realize the UAW made significant concessions a few years ago but they will have to tighten the belt again. Management needs to change. Yes, this may be a bit of guilt by association or simply bad timing but that's how it works. Strings must be attached that do just incentivize green tech but change the fundamental metrics in all aspects of their operations (as you say, design, manufacturing and sales).

Without getting into a dissertation, Wall Street is "sustainable" while at the same time "guilty" of egregious misconduct in terms of risk, opaque dealings, etc. The autos come hat-in-hand as consistently as a clock striking Noon. That's unsustainable. Lee Iaccocca (sp) did this already with Chrysler. GM and F will be back in 5-7 years -- no doubt. That's unsustainable.

[rosslynhoya]

This is first-rate humor from the Post:

www.washingtonpost.com/wp-dyn/content/article/2008/11/19/AR2008111903669.html

"There are 24 non-stop flights between Detroit and Washington" but the Big 3 CEOs took three separate private jets this week in order to fleece the U.S. taxpayer out of billions.