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Old 05-07-2009, 08:05 AM   #1
AVANTI R5
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Default Manny Lopez Rant/Obama's flawed auto logic




Quote:
President Barack Obama insists he doesn't want to run the domestic auto industry -- and we should all be thankful for that.

But his actions speak differently -- and we should all be worried.

"... I rejected the original restructuring plan" that Chrysler LLC submitted for government loans, he said April 30 in announcing his decision to force Chrysler into bankruptcy. "... And the standard I set was high -- I challenged them to design a plan ..."
That's a lot of self promotion and involvement from a guy who doesn't want to control the companies.

To be sure, the government, with the investment of $4 billion in our tax dollars in Chrysler and $15.4 billion in General Motors Corp. needs to set guidelines and rules for repayment. If not met, call the loans and get our money back.

But forcing a private American company into bankruptcy because the president thinks it's the most prudent action. Um, no. Not by any measure.

Blaming the hedge funds

The president found a scapegoat in the hedge funds that balked at the government's "offer" to take pennies on the dollar for their secured investment
"... It was unacceptable to let a small group of speculators endanger Chrysler's future by refusing to sacrifice like everyone else," he said.

Pardon me while I puke.

Chrysler's secured lenders held about $6.9 billion in debt and a couple didn't want to take significantly less than what they were owed. The lenders that opposed hold less than 10 percent of that debt.

You mean to tell me that the president, who has authorized more than $19 billion in cash to the auto companies, with much of it likely never to be repaid, was willing to force Chrysler into bankruptcy over less than a billion bucks?
When you're doling out dump trucks full of cash, another Ram pickup full doesn't break the government's back.

Too much auto ignorance

Make no mistake: The president had this outcome in mind all along. He'll force that action on GM, too.

All the while bashing Detroit for not being Toyota.

"I don't know how to create an affordable, well-designed plug-in hybrid. But I know that, if the Japanese can design an affordable, well-designed hybrid, then, doggone it, the American people should be able to do the same," he said during his 100-days-in-office speech. "So my job is to ask the auto industry: Why is it you guys can't do this?"

Seriously? GM is building the Volt. The Ford Fusion hybrid will get top mileage numbers.It's about time Obama starts looking past the nonsense he's being fed by Californians in Congress. Certainly, the domestic industry needs to do more and it didn't adapt fast enough.

But to suggest that less than a billion bucks forced Chrysler into court or that these companies aren't in the same league as the Japanese shows that the auto ignorance in Washington rolls on.
http://www.detnews.com/article/20090...376/1148/rss25
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Old 05-07-2009, 08:14 AM   #2
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Did Obama seriously say "doggone it"?
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Old 05-07-2009, 09:15 AM   #3
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This thread is going to get awesome..

The Obama supporters will surely start quoting this and that. I cant wait to hear how they discredit this....

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Old 05-07-2009, 09:24 AM   #4
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From just reading the article, it seems like this Manny guy isn't the sharpest tack either -

1. "If not met, call the loans and get our money back. "
2. "$19 billion in cash to the auto companies, with much of it likely never to be repaid"

contradicting his own main point...
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Old 05-07-2009, 09:29 AM   #5
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And so it begins....

he did not contradict anything. He said that the should call in the loans. Then he said that we will likely never see that money again. Even if we called them in we will never see them is what he is saying.

Why is that so hard to see.
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Old 05-07-2009, 09:31 AM   #6
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His rant is all over the place.

So the government can't refuse the loans, because then they're "forcing a private American company into bankruptcy". Apparently it's not Chrysler's lack of money that's forcing them into bankruptcy, it's the governments fault for not giving them more money.

The government also can't demand a restructuring plan before giving Chrysler money, because apparently that's too much involvement. Nope, they should just give them a loan and set rules for repayment, regardless of Chrysler's viability.

His argument boils down to "If you don't give Chrysler billions no questions asked, you're a commie!"

And using a $40k car that's still in development as an example for an affordable domestic hybrid?
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Old 05-07-2009, 09:43 AM   #7
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its getting better.
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Old 05-07-2009, 10:29 AM   #8
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And so it begins....

he did not contradict anything. He said that the should call in the loans. Then he said that we will likely never see that money again. Even if we called them in we will never see them is what he is saying.

Why is that so hard to see.
So if that's the case, why on earth should the government give Chrysler MORE money?
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Old 05-07-2009, 10:38 AM   #9
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THEY ShOULDN'T

We should not have given them anything in the first place!!!

Regardless of what the author of the article says, this has always been my belief
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Old 05-07-2009, 10:52 AM   #10
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Quote:
Originally Posted by SCRAPPYDO View Post
THEY ShOULDN'T

We should not have given them anything in the first place!!!

Regardless of what the author of the article says, this has always been my belief
We're past that point now. I didn't want them to get a loan either, but since the loans were paid out using our money there has to be some sort of follow through wouldn't you agree?
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Old 05-07-2009, 10:57 AM   #11
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Ibscrappydochangeyoucanbelievein
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Old 05-07-2009, 11:07 AM   #12
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not yet banyan... not yet.. don't be so jumpy. haha

Superglue, you bring up a point that bugs me. I am not sure really how to deal with this. I do not like any government oversite in private business. Never will. The problem with these bailouts is we have upset the natural function of capitalism. So now what do we do. We saved a sinking company that should have been allowed to fail.

IN my mind, I would cut my losses, and walk away. Following up with oversite of the money just creates a branch of the government to watch how they spend money. Nothing is constructive about that. Since we have already pardoned Chrysler for the debt, screwed over the shareholders, I say lets see if they can swim. Walk away. The money is already wasted, never to be repaid. Oversite will only cost more money, We through Chrysler a lifeboat. Lets see if they can stay afloat. If not, let nature take its course.

I would rather let Chrysler die, and take the money that was used to bail them out to keep the suppliers alive to ensure Ford and GM can live.
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Old 05-07-2009, 11:08 AM   #13
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Originally Posted by SCRAPPYDO View Post
THEY ShOULDN'T

We should not have given them anything in the first place!!!

Regardless of what the author of the article says, this has always been my belief
So what you're saying is, the author is wrong and Obama was right in not giving them more money?
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Old 05-07-2009, 11:11 AM   #14
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Originally Posted by SCRAPPYDO View Post
Following up with oversite of the money just creates a branch of the government to watch how they spend money. Nothing is constructive about that.
All the government have said is that the auto companies need a plan that is viable - and in order to be viable right now you need to be building smaller cars and alternative energy cars - not V8 SUVs.
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Old 05-07-2009, 11:15 AM   #15
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Quote:
Originally Posted by Superglue WRX View Post
We're past that point now. I didn't want them to get a loan either, but since the loans were paid out using our money there has to be some sort of follow through wouldn't you agree?
playing devil's advocate, isnt it also a little late for follow through as well? The money is gone, and market rules are STILL going to rule the day (bankruptcy, Fiat, etc) in the end. That could have been allowed to happen WITHOUT pouring $4 billion into the company.

Follow through methods are planned out IN ADVANCE, before the intial action is ever taken

when it was decided that bilions and billions of dollars were going to be handed out, I still do not understand why the governmenet didnt hire a third party consulting firm that would oversee the injection of this money, perform an audit, and make a case for better action. A firm/peoples with the CORRECT experience.
Smaller companies do this all the time and when far LESS money is involved...

This whole auto bailout thing has been a mess and SUCH a knee-jerk action that I cannot see very much good coming from it all.
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Old 05-07-2009, 11:31 AM   #16
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Quote:
Originally Posted by bal00 View Post
So what you're saying is, the author is wrong and Obama was right in not giving them more money?
you did not seriously connect those dots. HAHAHA..


If Obama shot the pope would you still find good in it.
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Old 05-07-2009, 12:36 PM   #17
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Originally Posted by SCRAPPYDO View Post
you did not seriously connect those dots. HAHAHA..
What's there to connect?
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Old 05-07-2009, 12:54 PM   #18
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Maybe, just a crazy idea, the companies should built what the people WILL buy... and the law makes should keep their hands out of forcing a market to move to where they want it to....

let the market do its job, for both banks and autos.
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Old 05-07-2009, 12:55 PM   #19
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Maybe, just a crazy idea, the companies should built what the people WILL buy... and the law makes should keep their hands out of forcing a market to move to where they want it to....

let the market do its job, for both banks and autos.
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Old 05-07-2009, 01:05 PM   #20
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Quote:
Originally Posted by Stonebaru View Post
when it was decided that bilions and billions of dollars were going to be handed out, I still do not understand why the governmenet didnt hire a third party consulting firm that would oversee the injection of this money, perform an audit, and make a case for better action. A firm/peoples with the CORRECT experience.
It's expensive to hire a consulting firm. And setting the terms of a governemnt loan is not the same as running (or giving advice on how to run) an auto company. If GM wanted, they could forget this whole business of dealing with the government and move right into Bankruptcy. They are the ones who begged for it.

And not to defend President Bush but he was right to provide relief for the auto industry. Remember back to 1929 when the stock market crashed? Also remember that a huge drought had caused a large number of farms across the US to fail which acted like a multiplier effect and drove us deeper into depression. The same thing could have happened except instead of Farms it would have been the auto industry. If the market had been healthy then I bet very few people would have batted an eye as GM and Chrysler filed for bankruptcy. But if action hadn't been taken in December we would be in a much worse situation than we are now.

I really don't get the argument here sometimes. We should let GM fail even if it can be saved just for kicks? Even though everyone (investors, owners, managers, workers, consumers) would be better of it it didn't? How does that make sense?
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Old 05-07-2009, 01:06 PM   #21
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Originally Posted by 2000wrx View Post
Maybe, just a crazy idea, the companies should built what the people WILL buy... and the law makes should keep their hands out of forcing a market to move to where they want it to....

let the market do its job, for both banks and autos.
What do you consider forcing? Dangling money in front of comopanies provided they change course? The government does that all the time in just the tax code. How is this any different?
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Old 05-07-2009, 01:28 PM   #22
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Originally Posted by matt30 View Post
It's expensive to hire a consulting firm. And setting the terms of a governemnt loan is not the same as running (or giving advice on how to run) an auto company. If GM wanted, they could forget this whole business of dealing with the government and move right into Bankruptcy. They are the ones who begged for it.

And not to defend President Bush but he was right to provide relief for the auto industry. Remember back to 1929 when the stock market crashed? Also remember that a huge drought had caused a large number of farms across the US to fail which acted like a multiplier effect and drove us deeper into depression. The same thing could have happened except instead of Farms it would have been the auto industry. If the market had been healthy then I bet very few people would have batted an eye as GM and Chrysler filed for bankruptcy. But if action hadn't been taken in December we would be in a much worse situation than we are now.

I really don't get the argument here sometimes. We should let GM fail even if it can be saved just for kicks? Even though everyone (investors, owners, managers, workers, consumers) would be better of it it didn't? How does that make sense?
I think the main complaint is that the same could be said for Chrysler. We dumped billions into it and it still went bankrupt. That money is now gone. A complete waste. GM will probably fail even if we give them money, so why give it to them in the first place. Give it to the suppliers who will be hurting without GM orders, and keep them afloat until GM restructures into a better company via bankruptcy.

just a different opinion to think about.
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Old 05-07-2009, 01:33 PM   #23
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Also that entire article failed on itself.

Quote:
President Barack Obama insists he doesn't want to run the domestic auto industry -- and we should all be thankful for that.
OK yeah I got ya.

Quote:
But his actions speak differently -- and we should all be worried.

"... I rejected the original restructuring plan" that Chrysler LLC submitted for government loans, he said April 30 in announcing his decision to force Chrysler into bankruptcy. "... And the standard I set was high -- I challenged them to design a plan ..."
That's a lot of self promotion and involvement from a guy who doesn't want to control the companies.
OK so setting guidelines for a loan is considered running a company now? And we shouldn't do it?

Quote:
To be sure, the government, with the investment of $4 billion in our tax dollars in Chrysler and $15.4 billion in General Motors Corp. needs to set guidelines and rules for repayment. If not met, call the loans and get our money back.
Wha?!? But you just said the governemnt shouldn't set rules and guidelines, and we should be worried. I R confused.

Quote:
But forcing a private American company into bankruptcy because the president thinks it's the most prudent action. Um, no. Not by any measure.
Umm...the plan was to keep them out of bankruptcy. Which failed in the case of Chrysler and uncertain in GMs case. Either way, what it means to call a loan is to "force" someone into bankruptcy. What R U talking about man?!?! What school of journalism did you go to?

Quote:
Blaming the hedge funds

The president found a scapegoat in the hedge funds that balked at the government's "offer" to take pennies on the dollar for their secured investment
"... It was unacceptable to let a small group of speculators endanger Chrysler's future by refusing to sacrifice like everyone else," he said.

Pardon me while I puke.
In truth they were offered stock options that could be worth more than the debt they held if Chrystler joined with Fiat out of bankruptsy. But Hedge funds thought they could get a better deal (read: more money, faster) in Bankruptcy court.

Excuse me while I puke on you for not telling the facts as they really are.

Quote:
You mean to tell me that the president, who has authorized more than $19 billion in cash to the auto companies, with much of it likely never to be repaid, was willing to force Chrysler into bankruptcy over less than a billion bucks?
When you're doling out dump trucks full of cash, another Ram pickup full doesn't break the government's back.
OK What?!? Now you're just talking nonsense. The original plan was to keep Chrysler out of bankruptcy. To do that, the governemnt suggested the only way they would give them another loan was if they worked out an agreement to partner with Fiat. Fiat wasn't comfortable with all the debt they were holding and wanted them to settle the issue by Bankruptcy with the governments approval and help.

But your saying the government should have provided Chrysler more money to stay out of bankruptcy? Wha? So they can waste that like they did the initial money?

Quote:
Too much auto ignorance
Yeah dude. Read a book. Or a newspaper since you work for one.

Quote:
Make no mistake: The president had this outcome in mind all along. He'll force that action on GM, too.
Thats called planning for all contingencies (esp when there are only two). It's what prudent people do. And considering he didn't start this whole loan mess, it would be his governemnt that would have to deal with the bankruptcy issues anyway.

Quote:
All the while bashing Detroit for not being Toyota.

"I don't know how to create an affordable, well-designed plug-in hybrid. But I know that, if the Japanese can design an affordable, well-designed hybrid, then, doggone it, the American people should be able to do the same," he said during his 100-days-in-office speech. "So my job is to ask the auto industry: Why is it you guys can't do this?"

Seriously? GM is building the Volt. The Ford Fusion hybrid will get top mileage numbers.It's about time Obama starts looking past the nonsense he's being fed by Californians in Congress. Certainly, the domestic industry needs to do more and it didn't adapt fast enough.
So saying that Americans do what the Japanese have done is the same as bashing? And making them accountable for their stalled projects is bashing? Whatever Opinion-guy-I've-Never-Heard-Of.

Quote:
But to suggest that less than a billion bucks forced Chrysler into court or that these companies aren't in the same league as the Japanese shows that the auto ignorance in Washington rolls on.


No Chrysler's crappy reputation, poor quality products, and general lack of customer satisfaction caused them to go to court. Ditto GM.

Whose the auto ignoramus now?

Last edited by matt30; 05-07-2009 at 01:42 PM.
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Old 05-07-2009, 02:17 PM   #24
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If you think about it, if somebody comes to you begging for money, like Chrysler and GM, and you give them the money with guidelines and strings above and beyond a simple interest rate, it does allow you some control. How much control depends on how badly GM and Chrysler want the bailout I suppose.

What the government did was basically say, we will give you the money but only if you do what we like. Keep bringing me plans until I find one I like, or else you do not get any money.

I have mixed feelings about this. I do believe that mistakes have been made and I do not need to reiterate them here yet again.

Chrysler ran a car company into the ground. They made sub par products and failed as a company to make money. So they go to the government to save them, begging for money.

the government gives them bailout money, but the company still goes bankrupt.

The Chrysler debt to the government is excused, screwing over the taxpayer

The government accepts 8% of Chrysler as payment for its bailout.

lets rewind...and try this another way.

Chrysler comes to government saying help me, were screwed if you dont help us.

Government says, sorry, you made the mess your in, dig your way out.

Chrysler goes bankrupt

In both scenarios, Chrysler went bankrupt, but one cost the taxpayer 8 billion dollars.

Some people can look past this stupid decision, but its staring you in the face as the biggest bonehead thing in the world to do.

So, why did the government do it? Why did they waste 8billion of yours and my money (this is both bush and obama here).

My suggestion...is neither wanted to be the guy in charge when 2 of the big 3 collapse.
So personal political protection motivated both men. Their job was more important than our money.

sigh..I am done with this. Can we talk about something else.
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Old 05-07-2009, 02:20 PM   #25
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Wow....

I'm thinking that any news relating to Obama should just be funneled straight to the political playground.. I forget how many threads there have been now that always seem to go down like this.

I do have to give credit to everyone maintaining relatively cool heads however.
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