More Bailouts?

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in case i fail,

http://buffalobeast.com/133/bigthree.jpg
 
lol American cars get such a bad rap on quality... its such an un far stereotype. i have a 2000 Chevy malibu that i have had NO problems with while one of my friends toyotas has had around 3k worth of work put into it... my last car (a ford Turtle) had 250k miles on it when i sold it and its still going strong (sold to a family friend) 2 winters ago my dad slid our Chevy Avalanche head first into a telephone pole. i wouldnt have wanted to tango with that thing in a camery. the car took it like a champ and even though the bumper was gone and headlight broken it still drove us home... (ended up having the whole front end replaced) one of my friends totalled his ford focus into a tree going 50mph. he walked away. cars as a whole are a crap shoot. but i for one have had good experiences with american cars....

honestly the only foreign car i can ever imagine buying is a luxury car. thats assuming i am ever in the market for a luxury car though. lol
 
I'm putting my money on, bailouts will fail causing great issues for Obama.

People will look to government for help due to the fact the economy is going down, down, down. The government will waste more tax dollars which people will be aware of.

The unemployment rate will rise. This will cause an accelerated tension towards the government from the middle and lower class.

With citizens realizing bailouts not being a solution, great distress and a lack of support for the government will formulate. People will be disappointed and feel their government is failing them.

After this point a large event will happen causing a "breaking" point of the tension. Citizens will finally be fed up will all the bullshit they've been put through for so many years. Bullshit caused by admin the Bush administration followed up by the worst economic crisis in history.

People can only take so much before bad things happen.

That's my forecast. Of course, we all cannot know what will happen. That's why I call it my forecast.

Only time will tell.
 
Oh and also.

Look around yourself. Look at the world our government wants us to see.

Our governments want us to see a world full of fear.

Fear of terror and terrorists.

Fear of the futures unknown economic situation.

Fear for our jobs.

Fear of other people. (No one trusts anyone anymore.)

Fear of global warming.

Fear of identity theft.

There's even fear of the damn president being assassinated.

There's even fear of your local law enforcement tasering you.

Everyday you look at American news it's all murder here, murder there. Murders everywhere.

fear, Fear, FEAR.

People are scared. FEAR is in control.

Recognize this. Realize this.
 
Your post was really good up until you started saying citizens were being "put" through bullshit.

Let me explain something to you NS. Controlled debt can be very very good. If there was no debt, this country would have never been built at the rate it has. Capitalism requires borrowing nowadays. This is how firms can grow to be so large. However, when debt accumulates and you are paying more in interests rates than the marginal propensity of the actual borrowing is worth then you are fucked. This is the stage our government is at. We are paying so much interest to China and other debtors that we need to straighten out our budget deficit.

Now, you cannot blame this on the government. You cannot blame this on anyone, the economic situation we are in is a massive chain of faults riddled through every section of the economy. To say the civilians are "innocent" and the big mean government is taking advantage of them is ridiculous! The average American is $9,000 in debt. They took out far more than they could pay back and tried to buy million dollar homes on a 20k a year budget. Citizens are just as much to blame as those big greedy financial institutes. You need to understand that the materialistic domination of this country is really hurting our ability to budget. Like I said, some debt is good, but not as much that revolves in this country.

Now, all of you that are against the bailout of the fannie mae and freddie mac institutions, you need to understand this HAD to happen. A collapse of those companies would send a shockwave so large through our economy it would automatically cause a giant recession, maybe even recognizable depression. Now why the bailout didn't work is another story. You see, the financial institutions fucked up, what's new? They kept all the money in the financial economic sector. This means none was lent to consumers or businesses because of our fear right now of economic collapse. Since they are just merging and buying other banks this will only worsen the inevitble collapse of this economy and worsen its effects.

In short: government is not the only thing wrong here. Government needs to intervene as proven by the great depression.
 
seems like i agree with republicans on this one, but they only don't support the bailout because they think they have an opportunity to go after the unions, democrats have harsh words for the executives, but in the end they cave and shell out the dough like some spineless parents pussywhipped by their own kids. same old usual bullshit
 
Well the million dollar homes on 20k budget was a bit of exaggeration to prove my point.

Good post though. True facts. Auto industry does represent a HUGE part of the economy though for just one industry. Filing for bankruptcy would be a good idea and save the debt that they had accumulated over the years from overbearing too much. It's just the way the bailouts occur that I am against. We just throw money into the wind and hope it works.

Also the auto industry needs to understand it can't pay its CEO's 5 times the amount that CEO's in other countries get. American CEO's get way more than they should, especially in a failing industry.
 
i'm happy someone finally brought up the airline industry with these whole matters. That whole industry has been possibly one of the sketchiest/hardest industries since 9/11. Huge layoffs, liquidation, and bankruptcy are the norm in aviation now. But the airlines don't go to the government asking for $300 billion every time they hit rough times (probably because by now they'd be doing that every 3 months anyways) instead they declare bankruptcy, and try to do what they can. The airlines come out a bit weaker than before, but then they are on their way again after making changes to try to become profitable.

The airlines, if anyone has noticed, are slowly making their way back to some form of unofficial regulation with only the biggest "legacy carriers" remaining. Hell, with 10 years it seems like Europe will be dominated by Lufthansa, British Airways, and Air France. (Air France actually had hard times so the French gov. bought them, and now they are one of (if not the) biggest airline in the world. They actually own the Dutch National Airline KLM, and will soon own the Italian Alitalia)
 
its completely the UAW's fault. its absolutely absurd how much UAW employees get paid.

absolutely absurd.

they get paid 75/hour including benefits and wages. whats more is that gm, chrysler, and ford, or any other domestic auto producer, isnt allowed to just arbitrarily fire them. they must employ the UAW and its so fucking dumb. Toyota and honda pay their employees only 30-40/hour and theyre turning a profit.

Also, if a factory is idled the workers get 95% of their wages for doing nothing! Factories get idled for months a time in the auto industry, and these workers still must be paid! What the fuck is that?! Has the US completely turned away from capitalism!? FUCK YOU UAW, its the nature of the beast. you shouldnt get money for when youre not working.

Its not a coincidence that GM is THE leading auto producer in russia and china, the two fastest growing markets in the auto industry.

ron gettlefinger should be sub poena'ed by congress and under go committe invesitgation. FUCK UNIONS. FUCK BLUE COLLAR WORKERS. GO TO SCHOOL, GET A MOTHERFUCKING GOOD JOB AND QUIT UNDERCUTTING OUR, NAY, THE WORLD'S ECONOMY.

If you're not going to get a job then fucking quit whining and work for 30-40 hours an hour.

I know ppl on this forum like Drew. don't believe in hereditary inheritance; he's spoken out aagainst rich people who can send their children to good schools because they have money.

Well drew youre missing a massive point: at the least those "rich kids" still have to work hard to achieve grades to get into good schools.

These motherfuckers working in unions get automatic membership based on next of kin. which is absurd. here is a much more direct example of hereditary inheritance. All you democrats, you want to outlet your rage because of your own shortcomings on someone? turn to the motherucking UAW.
 
woozy and MitchPee

Not that im disagreeing with you but what the fuck are you two talking about? None of that stuff has any relevance whatsoever to the auto industry!

The auto industry is most like agriculture, not aviation, not electronics, and especially not like the housing industry!

This has nothing to do with loans, predatory lending, adjustable rate mortgages, blah blah blah.

It has to do with how firms this big suffer from diseconomies of scale and must employ UAW workers while meeting stringent EPA regulations while balancing designed obsletism with coutneracting the publics perception that american car quality sucks.

Heres how it works (lets use GM as an example)

GM is massive with too many brands all competeing intrafirm for R&D investment and labor and monetary capital.

Each of those brands must also invest a lot of money into R&D not to just improve their cars, but also to meet the increasing EPA regulations set forth until like 2024 or something like that. That means every year theyve got to redesign a lot of components which means replacing tons of machinery and tons of prototyping which is mad expensive.

At the same time they have to pay the factory workers, the UAW about twice as much as what their competitors are paying, not to mention they must pay them 95% of wages during idle periods.

At the same time, they need to invest in marketing so the public doesnt associate american automobiles with crap. The only real way to do that is by actually making their cars better and earning like JD awards for best initial quality etc.

But then theres the other side: if you make your cars last for too long, then your customers won't be coming back to you often enough to buy new cars to generate revenue. That revenue is desperately needed to supply the cost of R&D to meet EPA regulations as well as to pay those fucking UAW douche bags. Its a huge problem because a very large protion of GM's customers are return customers. Its common in business to design intentional obseletism into their products but GM can't as fast as they want to because they have to boost quality to instill consumer confidence.

Its a terrible vicious cycle that is being magnifyed highly by the lack of consumerism in this current economy.

 
actually, i think woozy and mitchpee were just off topic and unrelated to the auto industry. Then i added to it with my aviation industry spiel. So we went from auto, to overall, to housing, then to aviation. And now we're back at auto

And i agree with you, it is a vicious cycle. There are an insane number of regulations and laws that they must conform to while still trying to make an affordable product and then make a profit off it. The economy right now is just putting them in a shitty position
 
actually United Airlines did first try to go to the government for loans to get themselves back up, but were rejected because of "poor money management"

And you've gotta remember, its a relatively slow process. UAL was under chapter 11 for quite awhile, a few years actually. But in the end i'd say it was better for them than the government loans because now it seems they run in a more profitable, economic way. It sucks for the employees though, thousands got furloughed as they reduced hubs and their fleet
 
You guys are espousing the same line you hear non-stop from every supposed expert. Freddie/Fannie/AIG/Lehman bros/Big 3/my pot dealer can't be allowed to fail or it will cause a ripple effect through the economy, freezing up credit and causing another (oh noezzzz) great depression!

Do you realize what we're doing right now with our trillions of dollars worth of bailouts? We're rewarding shitty management, we're encouraging continued support of our ridiculous quarterly profit based economy. The current crises started in the sub-prime meltdown and the sub-prime meltdown started because of short term thinking. Lenders were focused on increasing the price of their securities through risky loans, not even considering the death trap they were walking in to when people couldn't pay back.

Before you say anything, of course individuals were at fault. They're caught up in the ridiculous house of cards that is the U.S. economy. To whoever said that debt is needed to create growth in modern capitalism, you're right, but we've gone too far. We simply have too much debt and what you're seeing now is the cards collapsing. Our retail industry soared to new heights because individuals willingly took on huge amounts of debt to buy the newest useless fad. Our country's deficit is in the trillions, upon trillions of dollars. Debt is like No2 in a car, it'll supercharge any economic situation it touches, but if you continue to run on it you're going to have hell to pay.

One of the main reasons cited for bailouts is to thaw frozen credit markets (allow more borrowing/debt), but where does the U.S. government borrow the trillions of dollars that it's handing out like candy from? What happens when our credit dries up? What happens when the Chinese stop buying our bonds?

My point is that bailouts are a short term fix. If we allowed the economy to crash due to it's own blunders, times would be hard, but we would come back stronger in a decade. Right now all we're doing is propping up the house of cards, oblivious to the strong winds in the weather forecast that will knock it all back down again the future.

Please, somebody debate me, I'm bored and it's raining like hell outside
 
good posts so far.

good job jumister as well

i think the next round of bailouts will be certain states. i believe California asked for a bailout in october already because they could not meet government payroll. i believe any state that has a large number of unaccounted illegals to deal with will need a bailout or government jobs will be lost. the simple fact that these states cannot serve twice as much in services with only brining in half of the revenue needed to survive.

Also, seeing that these bailouts are on both sides of the party lines i dont know when it will stop. im not a huge fan of Obama at all but i think when he gets in he will be able to calm the American public down and mabey we can find a bottom to this mess.

The great depression happened because we had a true free- capitalistic market back then and the government did not step in anywhere near what this government is steeping in to do.

now, our economy is so tied into everything else, we have tight EPA laws, union contracts to deal with, high fuel prices (not so much anymore but they will go back up), high wage costs, high insurance costs, high raw material costs and tie that in with a major weak economy not scene since the late 70s and early 80s it makes into one weak economy.

if people were smart they would have seen this coming, mabey not to this extent but there are lots of businesses that saw this coming and adjusted for it. in my industry we saw this coming in july of 2007. the economy has been going down for awhile, people just ignored it until our government wrongly stepped in.
 
4D, it wont let me quote you but,

nobody is going to debate you because you are right IMO.

we know that the government is trying to help us from a severe recession or a depression but they are making it alot worse and i mean ALOT worse.

 
Whoa, chill bud. Not once did I ever say any of my post had to do with the failing automobile industry. I don't know where you got that link, but you misinterpreted very wrong.

With that said, I know very well how the auto industry works. If you look at my post above I explained something important to this mess. It is not just the blue collar workers getting paid here. Look at the CEO's...even during these falling stock times they are still getting the highest paid salaries of all time. While inflation has happened even accounting that is still showing salaries of CEO's at the highest they have ever been. It is like that in a lot of industries also. Look at most European companies, the same thing happens. Unions are a bit of a problem now, but with a bit of reorganization they going to get, everything should straighten out in the future.
 
Comparing an Avalanche to a Camry..........

I think American cars suck dick for the most part though, I've never had any problems with my volvo with 240k on it.
 
I'll agree it's a short term fix, but it is necessary. The economic

crash will be inevitable. I was the one saying that debt is needed for

capitalism and as I agree with you there is too much.

The thing about China is we are so interdependent on each other right

now it's scary. Wal-Mart does more trading with China than most actual

countries do. They will not stop buying bonds until it is not possible

anymore.

Basically what I am trying to say is that the crash will be inevitable.

The bailout however is needed for now. It could have been a great tool

but as I previously explained it was used wrong and too much money was

involved.

My solution: as much as the US spites socialism we need to make a mock

of what Sweden and Japan did when the housing bubble happened to them.

This is that the government steps in and doesn't give these firms the

money, rather buys up the markets and then sells it back later on to

the private sector. It will allow room for stabilization, but it is

probably too late for us to do this and our government spending has

been fucked by Iraq so it may not be a dream scenario.
 
something needs to change. and throwing money at the problems IS NOT, going to change it. last year GM and Toyota sold roughly the same number of cars. how can this be you might ask. well the numbers dont lie, GM cars sell, and they sell almost one for one with Toyota. BUT they are loosing money, and Toyota is making money. SOMETHING needs to change.

Let's get the hard numbers out of the way. Today General Motors

revealed that excluding special items, it posted a net loss of $23

million in 2007. Add in some funky deferred tax asset charge,

and the automaker's net loss last year rises to $38.3 billion. Aside

from that, we're interested in how GM fared in the business of selling

cars and trucks around the world last year. In 2007, the automaker

earned $553 million before taxes selling vehicles globally, compared to

losing $339 million in 2006. Worldwide vehicles sales increased 3% to

9.4 million vehicles last year, but the North American market was no

help, losing $1.5 billion before taxes.

If it were poker, Toyota would have looked at GM, pushed all its chips

into the pot and said, "You know what that means." The other marque in

the battle for worldwide supremacy has raised its projection for 2008

sales by 5-percent over this year, expecting to sell 9.85 million cars

around the world on production of 9.95 million cars. This year, 2007,

GM is estimated to have sold 9.3 million cars, compared to Toyota's

estimated sales of 9.36 million.

the big three need to fail. and then they can re emerge from bankruptcy and begin their rise...
 
to throw more fuel on the fire, does anyone on NS know how many dealerships GM has in the US? well its around 7k. lets take a guestimate at how many Toyota has. its under 1.5k. and it gets better, GM is some cases CAN NOT, shut down dealers in local markets. due to laws. how unfortunate.

Foreign-owned manufacturers who build cars with American workers pay

wages similar to GM's. But their expenses for benefits are a fraction

of GM's. GM is contractually required to support thousands of workers

in the UAW's "Jobs Bank" program, which guarantees nearly full wages

and benefits for workers who lose their jobs due to automation or plant

closure. It supports more retirees than current workers. It owns or

leases enormous amounts of property for facilities it's not using and

probably will never use again, and is obliged to support revenue bonds

for municipalities that issued them to build these facilities. It has

other contractual obligations such as health coverage for union

retirees. All of these commitments drain its cash every month.

Moreover, GM supports myriad suppliers and supports a huge

infrastructure of firms and localities that depend on it. Many of them

have contractual claims; they all have moral claims. They all want GM

to be more or less what it is.

hmmmmm GM pays people who dont work. good move guys!
http://online.wsj.com/article/SB122688631448632421.html
 
sorry, i should have expounded on this. that was a little smart ass poke at the whole "drive a prius" save the world crowd. who would love nothing more than to have us all driving around in little specs.

and what have your experiences been with american cars? just because your Volvo is a beast of a car (a good thing) doesnt make American cars suck dick... cant they both be good? or do foreign cars have a monopoly on quality?
 
so you are some sort of authority as to say american cars are not good? why do you say this? or is it a baseless claim?

if American cars are soooooooo bad then why did GM basically match Toyota world wide in sales? or are they just really good at marketing their shitty cars? you have me so confused.
 
the UAW fucked them over? management failed? costs to high, legacy costs, they pay people who dont work? they pay their employees to much, they pay to much in benefits to retirees...

was this a serious question? the issue at hand is far more complex than they simply make "shitty" cars. because that is NOT the case.
 
yes, its obviously the stupid workers fault that the giant multibillion dollar auto companies are under. look, their cars are simply not selling very well. shitty cars are a part of that, but not all.
 
what part of GM and Toyota sold roughly the same amount of cars yet GM lost BILLIONS and toyota MADE BILLIONS is so hard to understand? they have higher costs. they pay higher wages. their employees have astronomical benefits. while it is true that GMs market share here in the US has dropped off the map, they are still a viable global competetor with toyota. afterall they sell the same number of cars.
 
its not that simple. cars are made ALL over the world. its not like all "american" cars come from MI, and all "foreign" cars come from Japan. if fact toyota, honda, nissian, BMw, ect. have factory's here in America.

to answer your question directly, i have not found a number for US vs Japan. (spent the last 5 min looking)
 
except paying a CEO 2 million, or 20 million, or 200 million, or even 2 billion is sooooooo insignificant compared to the budget and expenses of the company. Cutting the CEO's salary would be the last step necessary to ensure a quality business plan. Telling the CEO's to cut salaries is a complete cop out. Rather than fixing the root problem which is the vicious cycle that is the auto industry, people love to scapegoat and point to CEOs who are undoubtedly smarter than you and ask why they are getting compensated.

Here's another point. Cutting the benefits of a CEO can severely damage a company's stock and thus its market cap. If a firm is cutting the wages of the CEO, who is afterall the head honcho doing business, other firms are going to be reluctant to do business with that CEO and confidence diminishes. Business confidence at the upper management levels invariably trickles down to the actual consumers which then gets reflected in dropping stock prices.
 
No offense, but you take things wayyyyy out of context.

I never said we should cut employee benefits. I was simply providing a statement which you took as a preamble to an argument that was not meant to be.

With that said, all I was trying to prove was that the benefits and salary should have never been this high. We as Americans have a tendency to really push it when times are good. If we had put on the brakes a little bit in the 70's and 80's instead of pushing growth, growth, growth we might not be in such financial trouble. When an economy grows too fast, it is very dangerous. Especially with inflation. I am sort of straying off so I just wanted to say that piece.
 
I worry about what injecting all this fake printed money will have on society as a whole, I could give a fuck if a good swath of unskilled, overpaid UAW workers lose their jobs.

Let the companies fall into chapter 11, then give them some money to get back on their feet.
 
Good to see some fairly well constructed arguments coming across here

I think NS is growing up a little
 
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