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Thread: US Lost Ten Billion Dollars on GM Bailout

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    Re: US Lost Ten Billion Dollars on GM Bailout

    Quote Originally Posted by PeteEU View Post
    So you are saying by "pretty fast".. a day or two, or a couple of months or several years?

    This is one of the biggest companies in the US, so the complexity of such a bankruptcy would be massive. Alone figuring out the value of the different parts of the company would take a while, and add in time for the creditors get a claim in and so on. All in the while the workers are fired, unemployed and the burden is pushed on the state.

    Now if you think that the other car manufactures will pick up the slack, then you forget the situation. Chrysler was also broke, and Ford was hurting. Had GM gone, and Chrysler also (took a long while and wheeling and dealing to allow FIAT to buy them), then the whole supply chain that also supplied Ford and other car companies.. well it could easily have collapsed.

    People on the right seem to think that the free market in its current form is dynamic and quick... it aint and never has been. It is slow as hell to react.. else why did GM get into trouble in the first place?

    Of course this depends on what kind of bankruptcy they would have done.. they could have done an "airline" bankruptcy, where they screwed over their workers and kept on functioning.
    In most bankruptcies the employees hardly notice the difference at all. There's a new name on their check stub and benefits might change but for most people they hardly notice the change at all.

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    Re: US Lost Ten Billion Dollars on GM Bailout

    Quote Originally Posted by pbrauer View Post
    Oh well, today we have hundreds of thousands of people who have a decent job and are paying Federal Income taxes. Factor that in the 10 billion what is then? I say President made a wise decision. And the supply chains was a key reason why he won Ohio.
    Many of the jobs would have survived bankruptcy. Notice any big layoffs from bankrupt American Airlines?
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    Re: US Lost Ten Billion Dollars on GM Bailout

    Quote Originally Posted by pbrauer View Post
    Oh well, today we have hundreds of thousands of people who have a decent job and are paying Federal Income taxes. Factor that in the 10 billion what is then? I say President made a wise decision. And the supply chains was a key reason why he won Ohio.
    Right. However, because the Obama Administration never wanted to let a crisis go to waste, they paid off their Union masters, and left the new GM under a pile of debt and long term liability, which could place those hundreds of thousands right back where they were.


    GM won't tackle pension talks with UAW until 2015: executive | Reuters

    (Reuters) - General Motors Co (GM.N) will wait until its next round of labor talks in 2015 before negotiating with the United Auto Workers about the automaker's U.S. blue-collar pension obligation, GM's vice chairman said on Friday.

    GM's pension obligation to UAW-represented workers in the United States was $71 billion at the end of 2011, the last time the Detroit company detailed its blue-collar pension obligation. That exceeds GM's current market value by about $20 billion.


    Jaguar, Land Rover, Volvo, and others all changed hands in 2008. These companies were niche players and sold for billions. What do you think a manufacture with a capacity to produce millions of vehicles, along with an in-place global dealer and service network would be worth?

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    Re: US Lost Ten Billion Dollars on GM Bailout

    Quote Originally Posted by polgara View Post
    It's just one aggravation after another, isn't it?
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    Re: US Lost Ten Billion Dollars on GM Bailout

    Quote Originally Posted by Lutherf View Post
    You're being REALLY short sighted.

    Just because GM stopped making cars and trucks doesn't mean that the demand for these items disappeared. People would still want their vehicles and manufacturers would still find a way to deliver on that demand. The likely outcome would be that Ford and Chrysler would have picked up some of the premium line and other manufacturers would have picked up facilities and equipment for producing specialty products. It's even possible that we'd have seen a surge in alternative fuel vehicles since those manufacturers could have picked up important parts for their production on the cheap.
    The demand for cars dropped from just under 17 million per year to around 10.5 million per year in the US. Chrysler was going under at the time and Ford was on the brink of it as well (Recall Fiat was pretty much given Chrysler). Had GM went under the parts suppliers that survived were going to go as well. Those suppliers also supply Ford, no suppliers no Ford.

    It would have taken years if GM was shut down for the auto industry to recover,
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    Re: US Lost Ten Billion Dollars on GM Bailout

    Quote Originally Posted by Lord Tammerlain View Post
    The demand for cars dropped from just under 17 million per year to around 10.5 million per year in the US. Chrysler was going under at the time and Ford was on the brink of it as well (Recall Fiat was pretty much given Chrysler). Had GM went under the parts suppliers that survived were going to go as well. Those suppliers also supply Ford, no suppliers no Ford.

    It would have taken years if GM was shut down for the auto industry to recover,
    GM would not have shut down. American Airlines flew while bankrupt. This is just administration propaganda.
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    Re: US Lost Ten Billion Dollars on GM Bailout

    Quote Originally Posted by Jack Hays View Post
    Gracie after a successful "mission" outside.

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    Re: US Lost Ten Billion Dollars on GM Bailout

    Quote Originally Posted by Lord Tammerlain View Post
    The demand for cars dropped from just under 17 million per year to around 10.5 million per year in the US. Chrysler was going under at the time and Ford was on the brink of it as well (Recall Fiat was pretty much given Chrysler). Had GM went under the parts suppliers that survived were going to go as well. Those suppliers also supply Ford, no suppliers no Ford.

    It would have taken years if GM was shut down for the auto industry to recover,
    So if there was no demand for cars and trucks GM should have been supported because.......why?

    Quite often the best time to make capital investments is when demand is low due to short term economic conditions like the 2009 crash. The bulk of GM manufacturing could have been picked up cheap and the buyer wouldn't have the burden of an underfunded pension plan or a financing division that was a mess. Such a move would have also had an immediate positive effect on the economy because the way things played out it only added a bunch of uncertainty to the bond market where all of a sudden bondholders could no longer be confidant that they would be in first position in the case of a bankruptcy.

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    Re: US Lost Ten Billion Dollars on GM Bailout

    Quote Originally Posted by Jack Hays View Post
    GM would not have shut down. American Airlines flew while bankrupt. This is just administration propaganda.
    There is noway you can compare a manufacturing company (GM) with a service company (AA). GM was dependent upon numerous supplies (tires, breaks, radios, ete. etc) while AA was dependent upon jet fuel.

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    Re: US Lost Ten Billion Dollars on GM Bailout

    Quote Originally Posted by pbrauer View Post
    There is noway you can compare a manufacturing company (GM) with a service company (AA). GM was dependent upon numerous supplies (tires, breaks, radios, ete. etc) while AA was dependent upon jet fuel.
    . . . and tires, and aircraft parts, and baggage handling equipment, and ground equipment, and aircraft, and . . . and . . . and . . .

    Try again.
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