Saturday, December 13, 2008

Why The Auto Bailout Should Die

This is an excellent article from Forbes showing why the automotive bailout is a huge con job.
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3 comments:

Anonymous said...

Not surprisingly, Forbes completely misses the point - again. Chrysler is privately owned - OK scary Forbes guy, so what? Will those jobs and supplier dependencies not be at risk as a result if they fail? I don't see the point - I guess because this guy has no point. The loan (not "bailout") that Chrysler would get is not about shareholders - it's about stabilizing the macro US economy. How Chrysler is owned is completely irrelevant. Would it be OK if they were still owned by German Daimler? Is that better?? Your government has given away - given away, not loaned - 4 TRILLION DOLLARS that are completely unaccounted for and without any tangible positive benefit. Note that B of A - a huge recipient - just announced lay offs of 35,000 workers and AIG is back asking for MORE cash. Now, the mindless dopes at Forbes are terrified - wringing their hands - about an 8 billion dollar BRIDGE LOAN with total government oversight. Let me assure you, if this doesn't get done, the stock market will be at 6,000. But, bailouts don't work right? Where was this moron when the TARP Christmas bonus fund was being handed out to his right-wing brothers?

5:44 PM
Subleum said...
This comment has been removed by the author.
1:07 AM
Subleum said...

I guess my opinion is that calling it a 'bridge loan' is kind of like calling giving some 20 year old $400,000 to buy a house (without checking any of their documentation) a "mortgage".

The big question: Why should the US taxpayers give Chrysler a 'loan' when their parent company could do the same?

Perhaps it's because the parent company realises what a sinking ship Chrysler has become. There's no hope of fixing it, just a hope of buying time before it all goes under.

And what if Chrysler gets the "bridge loan" and goes bankrupt? Is that still a bridge loan or does that become a 'sub-prime bridge loan'?

I think that's why the parent company has zero interest in putting in any of their own money. They know what a losing bet looks like.

And all the oversight in the world won't help when the *plan* is to pour the money into a black hole.

12:26 PM

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