[ITG chief economist Robert] Barbera warned that opposition to lending either the $17 billion agreed to — or the $34 billion that the car companies originally requested — could result in the stock markets’ plunging by hundreds of billions of dollars. And that does not include the billions of dollars in unemployment insurance benefits and pension bailouts that would be required to assist not just the displaced auto workers, but also the many other workers, like truck drivers and waitresses, whose jobs depend on the Big Three.

This is complete bullshit. The three companies were headed for extinction as their stock prices were near zero. Now because of other background developments they are in DC begging for free dough under the guise they are too big to fail. Bullshit.

The Repubs need to do whatever they have to to put these companies in Chapter 11. Up until Paulson/Bernanke/Bush started nationalizing the financial markets that is where all companies went that were poorly managed.

Now Pelosi/Reid/Obama want to take over from Bush and nationalize the auto companies, then health-care and then most every company connected to energy under the pretense of capping CO2 emissions.

What the f’k has happened to us in these last six months? Tell me what part of this stupid f’king journey is any different then the Chavez route? Keep thinking, there is none. Each was formulated on national emergencies. Read the quote above. Barbera sounds like a Propaganda Ministry official warning about the “great Satan” invading.

We are so f’ked.

patrick neid on December 8, 2008 at 12:59 PM

Can those who feel the auto industry should allow to fail explain what to do when employment numbers top 10%? And there’s no auto industry?

No auto industry? Put down the bong. There is a huge auto industry here and it would be much healthier if these junkyard companies were allowed to survive or perish on their own. The reason 61% of the American people are against this bailout proposal is because these are failing companies. Their stocks were trading at 50 year lows and they were heading for bankruptcy until this bailout mania started.

The general background noise and resistance to bailing out Detroit is due to the marketplace having previously determined that the Big Three are incompetent.

No amount of lipstick is going to change this. In fact, no matter the sums involved, they who are about to be scalped view the money as going down a rat hole. If, as previously mentioned, the companies instead were Mercedes, BMW etc the money would be forthcoming with no hesitation because they are viewed as viable institutions. GM, Ford and Chrysler? You have to be kidding.

Why the bank bailouts? They had been very viable firms. It is for this reason that financial institutions were given the benefit of the doubt. Many had been 100 year old companies that had built solid reputations. GM, Ford and Chrysler have done the opposite over the last 40 years.

If we were truly a free market economy they would go out of business as the other 50 or more auto companies went out of business between 1910 and 1940. In their stead all the better run auto companies would build and open new factories to take advantage of the new marketplace, hiring 100’s of thousands. The free market would invent a better mouse trap in a few difficult years.

Now we no longer believe in such a market. We will pay dearly for this shortcoming.

patrick neid on December 8, 2008 at 4:15 PM

roke,

God bless you but you have not a clue on how the market works. GM, Chrysler and Ford are considered the three worst car companies in the world. That is why their stocks were basically at zero. Mercedes sold Chrysler because they realized it was a hopeless company with useless union contract employees and managers.

As to the other companies cutting production, of course they are. The world economy has slowed to a crawl. The problems that are plaguing Detroit have nothing to do with the slowdown. GM etc have been losing market share for 30 years because they are an embarrassment in the industrial world.

As to the workers being laid off etc, cry me a river. Everyone else in the real world is subject to being laid off without, I might add these stupid union contracts that have put these companies on the welfare line.

The absolute best thing that could happen to these companies is to go into Chapter 11 and face the reality of being shit companies with shit management. Instead you are looking for a handout under the pretense that these companies are important. They are no such thing. They are way past their due dates. Clear them out and let smartly run companies take their places building better autos. Don’t even try to compare any of these companies to Toyota.

Basically I think the workers who didn’t take the golden parachutes they have been offered over the last several years were idiots.

Here’s a prediction–even with bailouts these companies are still going under and they deserve it. Tell me again who bailed out all the internet companies back in 2002-03 with their 100’s of thousands of employees. Go check the layoff stats in just Silicon Valley.

As to the financial companies–until this market bust each and every one of them provided a service that folks were happy with unlike the auto companies who people have been shunning for decades. Personally I have been against those bailouts also.

patrick neid on December 8, 2008 at 7:57 PM