The money that went to wall street has a lot of potential to correct some current problems.
Giving money to GM and Chrysler is like throwing it down the drain. The simple fact is that they are not making profit on their product, no amount of money is going to fix that.
From what I understand congress doesn’t mind loaning money to tie them over while they restructure if they have a plan in place to do so, but they will not loan them money just to do the same damn thing that hasn’t worked in 20 years.
And this is a mess:
UAW assembler earned 91% more in monetary wages than the average worker in the manufacturing sector, and a UAW electrician earned 123% more in wages than the average manufacturing worker
To bad it isn’t and they haven’t done shit with it. It was supposed to free up credit, but it hasn’t because none of the companies that got any of it are lending it anyway. All they are doing is sitting on it and we’re in the same boat weather they got the $ or didn’t. Citi is still cutting 50,000 jobs, BoA is cutting 35k jobs. And there is still a credit crunch in this country. How many times did AIG come back for more and then threw a $500,000 party with it. Where’s the oversight of the banking and finance industry? Where’s AIGs plan? How did their execs get to Washington, or better yet, did they even have to go? This whole polotical and financial system in this country is F-ed. All of them are corrupt. I’m starting to think Blogojevich is the norm not the exception.
Part of the reason the Auto makers are even in this mess is due to the credit disaster that started in the Mortgage industry. The only reason Ford isn’t in dire need isn’t because their cars are any better then GM or Chrysler’s, its because they mortgaged everything in 2006 for cash when they could get credit. Because the banks got greedy that credit isn’t available any more for Chrysler or GM, so their only other line of credit is the Fed.
^Isn’t the dollar growing in strength at this time (deflation)? Because of a lack of money being handed out.
People are “buying the dollar” at heck of a rate too, “investing” in the US I guess you could say.
At least that’s what I got from these articles: http://www.msnbc.msn.com/id/28192789/
Nov. wholesale prices drop 2.2 percent
Fourth monthly decline raises worries about deflation
Nov. wholesale prices drop 2.2 percent
Fourth monthly decline raises worries about deflation
Why deflation may help get us out of this crisis
Lower prices, while not always beneficial, may help workers’ real wages
Fed, in major shift, floods system with cash
“Much of the Fed’s spending money so far has been coming from “supplementary financing” from the Treasury, which continues to see strong demand for its own notes as investors around the world seek shelter from the financial storm. During the worst market turbulence, demand for Treasury notes has been so strong that interest rates on those notes have fallen below zero —which means investors are willing to lose a small amount of money in return for preventing bigger losses. That demand has also sent the value of the dollar soaring.”
MSNBC is my homepage, I’m not sure why I choose it. Although when the gates of lending open back up a rapid inflation could occur? If deflation continues I would think banks would WANT to loan money because its to their advantage to loan in a situation where money constantly gets worth more and more right? (Second article told me that).
Even the Japanese don’t think losing the Big 3 is a good idea. For those who say Toyota/Honda/Nissan are doing fine and will come out of this smelling like roses should read this.
Since my thread was closed, I’ll post in a five day old thread, fine by me.
Tax breaks are not the same as a bail out. Tax breaks are given to companies to lure them to do business in a given community because the local board or whom ever knows it will bring revenue into their county/state.
Which is exactly what happened when Washington Mutual bought Dime bank, and dime had a building in Albion, they gave Washington Mutual tax breaks to keep the building open because it held some 600+ jobs. I’m sure the same deal happened when Chase bought Washington Mutual. In fact I heard there were assembly men doing whatever they do to get chase to keep the building open. Hey, I still have a job, lol
Also, what you posted goes doubly against the bail out. It says that the foreign auto companies can and do profitability work in the us, so why can the big 3 do it?
I’m stealing much of this post from another forum, but they are great points and very applicable to this thread…
Time for the banks to pony up. They got their bail out to ammend their gross mismanagement. They plan the signed for the automakers in a LOAN.
The gov bailed out the banks to get ALL credit flowing again, not the stock values for the BOD bonuses.
Goldman Sachs made $2.3bil last year and paid a whopping 1% tax on that. (They paid 34% the year before.) How? They moved their bulk accounts off shore. Then they showed their American accounts as being in arears. The .gov bailed them out and they took that $$ and put it DIRECTLY into bonuses.
Crooked.
But shame on these auto companies that have no financing available to them because the banks won’t come off their cash and lend out money, even though the Fed gave them 700 Billion to do just that. Guess we should have asked the banks for their plan on how they were going to get credit flowing agian. Perhaps they mistook credit for bonuses. :gotme:
Fair enough, I concede. I originally read the first page (set on 50/page) and I thought I read enough and stopped checking it. After reading all of it i have to say I had no idea about the european/asain automakers needing money in the future, but I still stand on what I believe about the tax breaks and that its something that a lot of compaines get.
And they are right, 25B isn’t that much compared to everyone else, but it seems to be giving money to (temporarily?) save jobs, not fix the problem.
Eventually everything will fail in this country with all the government spending (like the one article that discussed all the money being spent over seas for nothing really) and the dollar meaning less and less and the national debt getting greater and greater, so why not see what we can do in the mean time to maintain/protect the way of life for millions?
It’s too bad that above visual aid will never come to light. Bam, national debt solved with a little tax increase for the people who will feel it the least.
Right tax breaks are not the same. You said the imports are not looking for a hand out. What the domestics wanted was a loan. What the imports want was a hand out.
The auto loans have to be paid back with interest and can be called if they do not follow the rules.
We bailed out the banks so they could give out loans but they decided to use the money to give out bonuses that they so deserve after running their companies into the ground.
Even if they were loaning money, the big 3 ceratinly wouldn’t qualify because they have done the same thing as the banks and run their companies into the ground.
For how long and how much do we keep pumping into the big 3 before we stop?
10 trillion?
We have given or loaned almost 8 trillion already and look where we are now. It doesn’t work (unless you are the one getting the bonus).
Hmm… there’s another organization out there that employs 235,000 people, indirectly supports millions and is $42 Billion short for the year. It’s in the middle of a financial reorganization that the unions are protesting and filing lawsuits against.
Should the taxpayers bail it out?
FYI - they will have to… because it’s the State of California I’m talking about.
This current economical environment will be tough for any company to survive in - note that Toyota is set to have its first operating loss ever this year - and Honda’s expected to follow suit. So for us to ignore the domestics at this point would be irresponsible, as any residual assets from a Chapter 7 (and that’s what a bankruptcy of the big 3 would mean) would probably go to the Chinese at fire-sale prices.
If that happens, I’d expect a BIG drop in American jobs and worldwide buying power.
