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GM's return to top continues as it rejoins S&P 500

Born Free said:
Sure they lost their investment, but who got bailed out?
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The company, the employees, the bond-holders. Other indirect beneficiaries include the companies that supplied parts (they'd be out of business), Ford (who buys parts from those companies), and existing GM/Chrysler car owners (who now get warranty service).

And what you're missing is that bailing out the existing shareholders in a bankruptcy would be highly unusual -- and, I might add, would just end up being another point of criticism and alleged favoritism / waste of money etc anyway.


OK show me for every dollar they loaned GM what did they receive back for that dollar?
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That's not how it works.

In a bankruptcy proceeding, creditors are first in line, and there's often negotiation about who gets what. Usually, everyone takes a bit of a haircut. It's rare that any bondholders get back 100%.


What are you talking about, sure I can fault Obama, first 1 million jobs is a crock and a crucial American industry, is nothing but liberal spin. That is the biggest lie of liberal BS. GM under bankruptcy would have been sold off in whole or in pieces at a bargain price....
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They would've fired a ton of people, other companies would have sacked employees, Ford would be screwed, wages would bottom out. Job losses would be huge.


The private sector never had a chance, GM was never up for sale in part or whole.
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The private sector "never had a chance" because the US was in the worst recession and credit crunch in 70 years. No one had the will or wherewithal to buy GM and Chrysler, especially since the entire US would've had a ****-fit if any foreign company tried to buy 'em out.


who do you think all those shareholders and bond holders were that lost all their money.
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And as I said, they were going to lose it no matter what. Even a cursory understanding of bankruptcy proceedings should make that clear.


Sorry, but that is as naive as it gets, the billions of lost tax payer money will never be returned, it's dead and gone.
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No, it's coming back as taxes on wages. Oh, and corporate taxes, forgot about that one.


The union worker instead of working for GM would be working for brand X and they would still be working and paying taxes.
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During 9%+ unemployment and the worst recession in 70+ years? Were YOU going to hire them?
 
pbrauer said:
Yes, he could have done much better with the $787 billion (not trillion dollar) stimulus, but according to the CBO the stimulus was a success.

Congressional Budget Office defends stimulus - Washington Post

Did the stimulus work?

Certainly not according to Republicans, who regularly blast President Obama’s “failed” economic policies on the campaign trail. GOP presidential candidate Mitt Romney has called the $787 billion package of temporary tax cuts and spending hikes “the largest one-time careless expenditure of government money in American history.”

But on Wednesday, under questioning from skeptical Republicans, the director of the nonpartisan (and widely respected) Congressional Budget Office was emphatic about the value of the 2009 stimulus. And, he said, the vast majority of economists agree.

In a survey conducted by the University of Chicago Booth School of Business, 80 percent of economic experts agreed that, because of the stimulus, the U.S. unemployment rate was lower at the end of 2010 than it would have been otherwise.

“Only 4 percent disagreed or strongly disagreed,” CBO Director Douglas Elmendorf told the House Budget Committee. “That,” he added, “is a distinct minority.”
​
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That's absolutely ridiculous.

It's easy enough to go around and find subjective opinions on the effectiveness of the stimulus, but allot of their argument ( ones who believe it was successful ) comes from the bankrupt premise that Government printing and borrowing being pumped back into the economy is a trade off that pays back on the investment.

Nothing is further from the truth, as Barrack Obama brought in the creme of the crop of useless liberal economist in 2008, who had decades of experience applying their corrupt theory in a vacuum ( classroom ) but never in the real world.

Billions pumped back into public sector Unions so it could be transferred back to Democrat re-election funds via Union dues, so battleground states could be kept Democrat and poor.

His Green jobs initiative was about the most retarded AND corrupt jobs initiative this Country has ever been exposed to. It was a 5th Grade Science experiment literally applied to our free market system, with little thought to ....well anything.

High end Obama supporters and donors were set up in Green Job manufacturing companies before there was any demand, as the demand as Obama admitted was going to come from new taxes and regulations on coal, Co2 and oil and just about anything that would make your energy expenses sky rocket.

NO THOUGHT was given to China's ability to come in and undercut manufacturing cost so low it shut those companies down and wasted billions in borrowed monies.

You guys seriously screwed the Country over....you have no idea.

Ever since then we've been getting manipulated data and numbers so Obama could give the impression of growth, but again, NOTHING that comes out of his administration is truthful.

TRILLIONS in FED printing to buy up Treasuries so all of Obama's new debt can be kept cheap, and so those with a third grade understanding of the economy can brag about the Stock markets new heights...lol'
 
OpportunityCost said:
Due to Obama's interference in the bond market, blue chips, or those too large to fail without government stepping in, are having credit issues. Because no one is willing to buy first lien positions....
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Really? Is that why corporate bond sales hit a record in December 2012?

Corporate Debt Sales Hit Record - WSJ.com

Investors are falling all over each other to buy corporate debt.

Oh, and bailouts like these aren't exactly new or unprecedented. In addition to previous auto industry bailouts (*cough* Reagan, Chrysler) they intermittently get involved in airline and rail bankruptcy proceedings. Please feel free to blast Reagan for saving Chrysler, I'm sure he did the wrong thing by having the government get involved in private industry. He should've just let Chrysler fail. :mrgreen:
 
Visbek said:
The company, the employees, the bond-holders. Other indirect beneficiaries include the companies that supplied parts (they'd be out of business), Ford (who buys parts from those companies), and existing GM/Chrysler car owners (who now get warranty service).

And what you're missing is that bailing out the existing shareholders in a bankruptcy would be highly unusual -- and, I might add, would just end up being another point of criticism and alleged favoritism / waste of money etc anyway.



That's not how it works.

In a bankruptcy proceeding, creditors are first in line, and there's often negotiation about who gets what. Usually, everyone takes a bit of a haircut. It's rare that any bondholders get back 100%.



They would've fired a ton of people, other companies would have sacked employees, Ford would be screwed, wages would bottom out. Job losses would be huge.



The private sector "never had a chance" because the US was in the worst recession and credit crunch in 70 years. No one had the will or wherewithal to buy GM and Chrysler, especially since the entire US would've had a ****-fit if any foreign company tried to buy 'em out.



And as I said, they were going to lose it no matter what. Even a cursory understanding of bankruptcy proceedings should make that clear.



No, it's coming back as taxes on wages. Oh, and corporate taxes, forgot about that one.



During 9%+ unemployment and the worst recession in 70+ years? Were YOU going to hire them?
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We are CURRENTLY, experiencing the worst recession in a 100 years and is has nothing to do with George Bush and everything to do with Obama's policies.

The job numbers and the monthly GDP had already bottomed out and started to bounce back prior to any funds being released from the stimulus.
 
Visbek said:
Really? Is that why corporate bond sales hit a record in December 2012?

Corporate Debt Sales Hit Record - WSJ.com

Investors are falling all over each other to buy corporate debt.

Oh, and bailouts like these aren't exactly new or unprecedented. In addition to previous auto industry bailouts (*cough* Reagan, Chrysler) they intermittently get involved in airline and rail bankruptcy proceedings. Please feel free to blast Reagan for saving Chrysler, I'm sure he did the wrong thing by having the government get involved in private industry. He should've just let Chrysler fail. :mrgreen:
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Why do you guys keep posting around the obvious ?

Perpetual QE is the SOLE reason for corporate stocks as the massive purchasing of TREASURIES removes allot of the risk out of private securities.

It's a remedy that's going to be worse than the disease ....well at least for middle class Americans.

The effect of the FEDS policies on the jobs market and on the real economy is absolutelty zero.
 
Visbek said:
Really? Is that why corporate bond sales hit a record in December 2012?

Corporate Debt Sales Hit Record - WSJ.com

Investors are falling all over each other to buy corporate debt.

Oh, and bailouts like these aren't exactly new or unprecedented. In addition to previous auto industry bailouts (*cough* Reagan, Chrysler) they intermittently get involved in airline and rail bankruptcy proceedings. Please feel free to blast Reagan for saving Chrysler, I'm sure he did the wrong thing by having the government get involved in private industry. He should've just let Chrysler fail. :mrgreen:
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There was a huge credit crisis around the time GM was having problems, this made it worse---thats my opinion.

Right now, QE to the tune of 1T may have something to do with cheap lending being successful. Plunging into margin right now wouldnt be my financial goal.
 
pbrauer said:
All the credit markets were closed at the time, it was Uncle Sam or nothing. Today there is approximately 1 million people working because of the bailout of GM and Chrysler. The citizens of Ohio showed their appreciation to President Obama by voting for him. Oh and all those workers are paying their share of FIT.
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There would be more people working now if GM had gone through bankruptcy. The ONLY difference the bailout made was that the union survived with their bloated wages and benefits and to this day hangs like a leach drinking the blood of stockholders, customers, and non-union workers with no benefit to anyone but the union. And because the union is still there GM can't afford to hire more people.
 
pbrauer said:
In a survey conducted by the University of Chicago Booth School of Business, 80 percent of economic experts agreed that, because of the stimulus, the U.S. unemployment rate was lower at the end of 2010 than it would have been otherwise.
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80% is far from 100% and interesting they don't state how much lower the unemployment rate would have been otherwise.

Let me try this. For a trillion dollar stimulus you would sure think we would have got more for our buck than we did. Instead we got a trillion dollar increase in debt that our great grand-kids have to pay back. I suspect they would not be happy having to pick up the tab. Of course no one really cares about that, Obama did at one time, but that was all spoofing the public to get elected.

Obama says adding $4 trillion to debt is unpatriotic. - YouTube

Annotating Obama’s 2006 speech against boosting the debt limit - The Washington Post
 
pbrauer said:
All the credit markets were closed at the time, it was Uncle Sam or nothing. Today there is approximately 1 million people working because of the bailout of GM and Chrysler. The citizens of Ohio showed their appreciation to President Obama by voting for him. Oh and all those workers are paying their share of FIT.
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Please show me links to unbiased, factual evidence that ANY of those 1 million employees would not have simply started working in the same factories producing the same/other vehicles for the manufacturers that bought them up after GM broke up?


Corporations go bust every year.

When they do, usually other corporations buy up the worthwhile components (and personnel with them), discard the rest and life goes on.

For example, both Pontiac and Saturn had American buyers lined up to take them over when GM went belly up. But Government Motors refused to sell them and they just vanished - along with the thousands of workers they employed.

If the free market had been allowed to work, those divisions might still be around, producing cars and employing thousands of Americans.


GM represented 20% of the U.S. market - you think people who previously bought GM's were simply going to stop buying cars when they went under?

Of course not - they would buy other cars.

And since it would cost other car manufacturers FAR less money to take over ex-GM plants sold at auction, rather then build brand new ones from scratch; then it is reasonable to conclude that many/all of those workers would simply now be doing the same thing they are doing now, for someone else. PLUS, the American taxpayer would not be out well over $10 billion dollars from the GM bailouts that they never have to be repaid since they were - in essence - gifts from the government.
 
In the end, GM makes ****ty, unreliable, uninteresting appliance vehicles that are way overpriced. And the only interesting vehicle that they make, the Volt, is so ridiculously overpriced that you'd have to have a lot of money and a retarded brain to even consider buying one. The handout from the government will only go so far until they're right back in the same situation, unless they get their act together and actually make vehicles that people are willing to, and can afford to buy.

On the flip side, Ford has gotten their **** together, and they didn't even take bailout money. They make A LOT of nice vehicles that I would, and actually could afford to buy these days.
 
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LowDown said:
There would be more people working now if GM had gone through bankruptcy.
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Who was going to hire them? You?

Unemployment in 2008 was higher than usual, especially in Michigan. If anyone was willing and able to hire people with the same skill-set, they would have done so regardless of the auto bailout.


The ONLY difference the bailout made was that the union survived with their bloated wages and benefits....
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A lot of those "bloated" union wages were slashed and benefits cut.

Again: Eye and dental coverage were axed. New hires are paid at almost half the wages as before ($17/hr instead of $29/hr), and they also get 401(k)'s instead of pensions. They no longer have guaranteed annual raises; they now get profit sharing, so if the company is not profitable, they don't get a raise or bonus. The "job bank" -- where union employees who were temporarily laid off would get paid regardless -- got axed. Strikes have been banned. The stock received by the UAW is non-voting, and because of that setup, the companies cut their health care obligations to pensioners by 50-70%.


and to this day hangs like a leach drinking the blood of stockholders
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Yet again, stockholders in the old GM were screwed anyway. And the only way stockholders in the new GM will benefit is if the employees are sufficiently motivated to do a decent job.

As much as you may wish it otherwise, the reality is that unions still exist, and almost certainly will continue to exist in the manufacturing sector.


customers
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Existing GM and Chrysler customers would have been screwed if the companies went up, since all those warranties would be worthless, and parts companies would lose a ton of business.

New customers of GM and Chrysler buy of their own free will. Market forces are just as present as always; if the companies charge too much, it will impact sales.


And because the union is still there GM can't afford to hire more people.
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GM added around 600 employees last year, and are hiring 4000 more this year.
Recession's Over: GM Hires New Employees, Not Laid-Off Workers, to Build Cadillac ATS - Automotive News
GM Plans to Hire 4,000 New Employees | Wall St. Cheat Sheet

Chrysler added 1,800 employees last night. They're now adding another 1,250 employees and investing $374 million into its Indiana plants.
Chrysler To Hire 1800 New Workers « CBS Detroit
Chrysler announces 1,250 jobs, $374-million investment for Indiana plants | Detroit Free Press | freep.com

And maybe I missed it, but I don't recall all that many people eviscerating Reagan for saving Chrysler in 1980.
 
Fenton said:
The GM bailout was a payback to the Unions for their support, plain and simple, it was a poor choice that cost tax payers billions and basically let any Union know, if they're large enough, they can through the threat of strikes and collective bargaining run any American Corporation into the ground and receive a leg up when that corporation can no longer keep it's head above water.

GM should have been allowed to go through a managed bankruptcy. Forget that their stock has risen in a Stock Market that exclusively held up with low interest rates falsely pushed down with massive printing and monetizing of our own debt. A stock market that's waiting for the first indication of stopping of QE so they unload massive amounts of over priced assets, equities and bonds.

The GM bailout set a bad example.

Mark Milke: Bailouts of GM and Chrysler were a bad idea - Opinion - Times Colonist
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I don't blame the unions. I blame management that agreed to their demands.

I agree about the bailout, though...reluctantly. Our recession would have been much worse had we not had that bailout. There's just no question about it. No sense cutting off noses.
 
Visbek said:
And maybe I missed it, but I don't recall all that many people eviscerating Reagan for saving Chrysler in 1980.
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You did miss it.

Reagan was widely criticized by Conservatives of the day and of course Chrysler had to be bailed out again. Companies should be allowed to fail and in fact that's how the economy grows, with newer and better run companies taking their place. The taxpayer could have bailed out buggy manufacturers as well, or shippers of whale oil but they had the wisdom to let the market and the consumer make the decisions as to who will succeed and who will fail. The politicians cannot and should not even try to get involved but should instead strive to keep everyone honest.
 
Grant said:
Reagan was widely criticized by Conservatives of the day....
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Actually, Carter signed the bill. My bad.

By the way, GM was facing problems as early as 2006. The Bush administration basically refused to do anything about it. The private sector completely failed to step up to the plate. GM didn't want a bailout, and fired huge numbers of employees.

You sure you remember things right? :mrgreen:


of course Chrysler had to be bailed out again.
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Erm.... 30 years later. Seriously? That's longer than the lifespan of some companies.


Companies should be allowed to fail and in fact that's how the economy grows...
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Japan and China coddle their big corporations, far in excess of anything the US does. That's one of many factors in the success of those companies.


The taxpayer could have bailed out buggy manufacturers as well, or shippers of whale oil but they had the wisdom to let the market and the consumer make the decisions....
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Americans have not decided to stop buying cars.

And no one is forcing Americans to buy GM and Chrysler cars. They still need to compete in the marketplace.


The politicians cannot and should not even try to get involved but should instead strive to keep everyone honest.
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And yet, everyone from every point on the political spectrum is demanding that the government a) stop job losses and b) create jobs.

Let's face it, anything Obama did in this situation would be grounds for right-wingers spewing vitriol. If he bailed out the auto companies, he's a bastard for interfering in the course of business. If he does nothing, he's a callous job-destroyer who did nothing to stop unemployment, and let a major US industry fail on his watch.

So pardon me if I take some of these objections with a big ol' heaping of salt over my shoulder.
 
The Man said:
In the end, GM makes ****ty, unreliable, uninteresting appliance vehicles that are way overpriced. And the only interesting vehicle that they make, the Volt, is so ridiculously overpriced that you'd have to have a lot of money and a retarded brain to even consider buying one. The handout from the government will only go so far until they're right back in the same situation, unless they get their act together and actually make vehicles that people are willing to, and can afford to buy.

On the flip side, Ford has gotten their **** together, and they didn't even take bailout money. They make A LOT of nice vehicles that I would, and actually could afford to buy these days.
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If both GM and Chrysler had gone out of business I see no reason to doubt that Ford would have expanded to exactly fill in the part of the market left open by the demise of the other two companies. We'd have as much demand as before for American cars, Ford would be making and selling as many as otherwise are being made by all three companies, consumers would be getting better cars, and taxpayers wouldn't be on the hook for the cost of saving the two inferior companies that couldn't stand on the quality and value of their own products.
 
Visbek said:
Who was going to hire them? You?

Unemployment in 2008 was higher than usual, especially in Michigan. If anyone was willing and able to hire people with the same skill-set, they would have done so regardless of the auto bailout.
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GM would have hired them when they emerged from bankruptcy, and they'd have had more resources to do so and would have been able to hire more people because labor would have been less expensive.

A lot of those "bloated" union wages were slashed and benefits cut.
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They are still bloated, though.

Again: Eye and dental coverage were axed.
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They still qualify for the Cadillac health coverage tax!

New hires are paid at almost half the wages as before ($17/hr instead of $29/hr), and they also get 401(k)'s instead of pensions. They no longer have guaranteed annual raises; they now get profit sharing, so if the company is not profitable, they don't get a raise or bonus. The "job bank" -- where union employees who were temporarily laid off would get paid regardless -- got axed. Strikes have been banned. The stock received by the UAW is non-voting, and because of that setup, the companies cut their health care obligations to pensioners by 50-70%.
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Yes, these would be the workers the senior union members screwed over. Nothing new about that. Just so they get their boodle.

Yet again, stockholders in the old GM were screwed anyway. And the only way stockholders in the new GM will benefit is if the employees are sufficiently motivated to do a decent job.
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Start firing people who don't do a good job and the rest will be highly motivated. But no, it's impossible to do that, hence the need for a bailout.

But I'll tell ya, my heart really bleeds at the news that the jobs bank was axed. What is a union without no show jobs?

As much as you may wish it otherwise, the reality is that unions still exist, and almost certainly will continue to exist in the manufacturing sector.
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Sure, sure, unions will exist. But we should no longer have to put up with the Wagner Act. It's outdated and it's harming American industry. FDR brought in the Wagner act, and then the next big crisis that comes along, WWII, he shuts it down because he knows it would interfere with productivity.

New customers of GM and Chrysler buy of their own free will.
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Yeah, perhaps none so enthusiastically as the federal government.

Market forces are just as present as always; if the companies charge too much, it will impact sales.
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More like political forces and crony capitalism.
 
Visbek said:
Actually, Carter signed the bill. My bad.

By the way, GM was facing problems as early as 2006. The Bush administration basically refused to do anything about it. The private sector completely failed to step up to the plate. GM didn't want a bailout, and fired huge numbers of employees.

You sure you remember things right? :mrgreen:
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Carter signed the bill and the money was paid out under the Reagan administration. Toledo Blade - Google News Archive Search

What would you want the private sector to do? The private sector was already in the auto business and there was no crisis as far as the lack of vehicles went.


Erm.... 30 years later. Seriously? That's longer than the lifespan of some companies.
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It doesn't matter. What good is a company that has to be bailed out every 30 years?

apan and China coddle their big corporations, far in excess of anything the US does. That's one of many factors in the success of those companies.
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Now America wants to emulate Japan and Chine while they want to emulate America?

Americans have not decided to stop buying cars.
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Exactly. So why should the taxpayer be responsible for ailing out auto companies when their is no reason to do so? It's the consumer and taxpayers who should be considered, not big business.
And no one is forcing Americans to buy GM and Chrysler cars. They still need to compete in the marketplace.
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The fact is that they couldn;t compete or they wouldn't have needed taxpayers dollars.



And yet, everyone from every point on the political spectrum is demanding that the government a) stop job losses and b) create jobs.
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That's obviously untrue.
Let's face it, anything Obama did in this situation would be grounds for right-wingers spewing vitriol. If he bailed out the auto companies, he's a bastard for interfering in the course of business. If he does nothing, he's a callous job-destroyer who did nothing to stop unemployment, and let a major US industry fail on his watch.
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Obama is dishonest and clueless but those terms you use are new to me.

So pardon me if I take some of these objections with a big ol' heaping of salt over my shoulder.
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No prob. Go ahead.
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Bob Blaylock said:
If both GM and Chrysler had gone out of business I see no reason to doubt that Ford would have expanded to exactly fill in the part of the market left open by the demise of the other two companies.
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The problem with that theory is that GM, Chrysler and Ford have many suppliers in common. Without GM and Chrysler, those suppliers would have gone under, which would have seriously harmed Ford.

Ford also would have had no way to ramp up production fast enough. The credit markets were frozen, so no one would have given them the funds to buy up the charred remains of GM and Chrysler. Plus, sales have been migrating to Japanese companies for years (notably Toyota). The destruction of two of the Big Three was not likely to boost Ford's sales.

That's why Ford joined the push for the bailout, and their CEO still says it was a good idea. If they could have benefitted, they would've sat on the sidelines.

And let's face it, if ~13% of US GDP went south, there is no way that could possibly have been good.
 
Visbek said:
The problem with that theory is that GM, Chrysler and Ford have many suppliers in common. Without GM and Chrysler, those suppliers would have gone under, which would have seriously harmed Ford.
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Suppliers would have altered their supplies. Car parts would still be required no matter who makes the cars. There would also be the same number of gas stations and car washing businesses.
Ford also would have had no way to ramp up production fast enough. The credit markets were frozen, so no one would have given them the funds to buy up the charred remains of GM and Chrysler. Plus, sales have been migrating to Japanese companies for years (notably Toyota). The destruction of two of the Big Three was not likely to boost Ford's sales.
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Other car companies, also manufacturing in the US would take up any slack.

That's why Ford joined the push for the bailout, and their CEO still says it was a good idea. If they could have benefitted, they would've sat on the sidelines.
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Ford refused any bail out money and did very well.

And let's face it, if ~13% of US GDP went south, there is no way that could possibly have been good.
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Markets correct themselves, governments distort them.
 
LowDown said:
GM would have hired them when they emerged from bankruptcy
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GM and Chrysler were not going to emerge from bankruptcy. They would have been liquidated, because no one in the private sector had any interest in saving those companies. As noted, they were trying for years to arrange a rescue, and the private sector offered no help whatsoever.

The unions had already made significant recessions. And contrary to your claims, GM and Chrysler are apparently bouncing back, and hiring people, both union and non-union.
 
MaggieD said:
I don't blame the unions. I blame management that agreed to their demands.

I agree about the bailout, though...reluctantly. Our recession would have been much worse had we not had that bailout. There's just no question about it. No sense cutting off noses.
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Putting aside any inane partisan debate of the issue, not sure why you are so sure what the outcome would have been without the bailout. I can't know for sure, but do think that the company could have survived under a structured bankruptcy just like companies in the airline industry have.

To think that all of that manufacturing capacity would have gone unused throughout the world, including a valuable franchise in China and an important franchise in the U.S. and Europe, I just find hard to believe. What the deal would have looked like, no idea. People like to call this the greatest recession since the great depression. It was a very deep and very short recession, fueled largely by a) the bursting of a housing bubble and b) a panic run on financial institutions, which led to corporations not being able lend thus cutting manufacturing and inventory reductions as CFOs pulled in their horns. Car sales naturally fell off a cliff, so GM was in a tight squeeze due to lousy management. Their assets and brands always had value.
 
Grant said:
What would you want the private sector to do? The private sector was already in the auto business and there was no crisis as far as the lack of vehicles went.
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Several people on this thread are claiming that the Big Three could have been saved by a normal private bankruptcy. It's a fantasy. If GM and Chrysler failed, all three would have ended up liquidating, tons of jobs would have been lost.


It doesn't matter. What good is a company that has to be bailed out every 30 years?
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I guess you don't have any interest in commercial airlines, then. :D They frequently get bailed out. The only way they could survive would be to reduce flights, slash everything to the bone and significantly increase prices. And even that might not be enough.

S&L's also had to get bailed out, when those *cough* private sector banks mismanaged their funds and went belly up.


Now America wants to emulate Japan and Chine while they want to emulate America?
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No, I'm pointing out that Japan and China do not let companies rise and fall on their own merits. They not only survive with massive government support, they actually thrive off of it.


Why should the taxpayer be responsible for ailing out auto companies when their is no reason to do so? It's the consumer and taxpayers who should be considered, not big business.
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Because the entire US economy would suffer if the Big Three went under and their employees were unemployed.


That's obviously untrue.
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Seems screamingly obvious to me. A lot of Republicans are biased against Obama, and were before he even took office.


Obama is dishonest and clueless....
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See what I mean? :mrgreen:
 
Visbek said:
Several people on this thread are claiming that the Big Three could have been saved by a normal private bankruptcy. It's a fantasy. If GM and Chrysler failed, all three would have ended up liquidating, tons of jobs would have been lost.


:
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Everything has a price. To say the assets had zero value is silly. Same assets that are now being included in the S&P 500.
 
washunut said:
Everything has a price. To say the assets had zero value is silly. Same assets that are now being included in the S&P 500.
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It's not that they had "zero value."

It's that during a reorganization, companies still need funding and huge amounts of credit just to keep going and to pay their suppliers. Since the private sector was unwilling and/or unable to provide that funding, the companies would have needed to liquidate just to keep the bankruptcy going. This in turn would have sunk their suppliers, who wouldn't get paid. Those suppliers also make parts for Ford. There would have been a cascade effect on the entire industry.

And yes, brands with international recognition, long histories and profitable pasts certainly can fail, brands lost or turned into shadows of their pasts. Pan Am, Lehman Brothers, Woolworth's, Polaroid, Kodak....
 
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