GM enters bankruptcy protection

[longam]

Looks like were giving them another 30 billion. Must be to pay out the bonus to everyone before they roll over and die.

[mookiemookie]

Originally Posted by SteamWake

Well no kiddin, look whos running it.

Again name me one federal goverment entity that is run profitably, and efficently.

HOLC turned a profit by the time it was phased out in the 50s and the prison system is run pretty efficiently.

[mookiemookie]

Originally Posted by SteamWake

Well I dont think they planned on the largest financial debacle in the history of mankind.

Nope, they didn't plan at all. They dug up the corpse of Reagan and kissed his dessicated hand and deregulated for the sake of deregulation all while chanting "the free market will take care of everything, the free market will take care of everything..." with glazed eyes and dopey smiles.

Fat lot of good it did us.

[SteamWake]

Originally Posted by mookiemookie

Nope, they didn't plan at all. They dug up the corpse of Reagan and kissed his dessicated hand and deregulated for the sake of deregulation all while chanting "the free market will take care of everything, the free market will take care of everything..." with glazed eyes and dopey smiles.

Fat lot of good it did us.

Yes if only they had taken that advice and let the free market take care of things.

[mookiemookie]

Originally Posted by SteamWake

Yes if only they had taken that advice and let the free market take care of things.

It sure wasn't excessive regulation that repealed Glass Steagall and allowed investment banks and depository banks to merge in an unholy alliance of risk. It was precisely that deregulatory attitude that removed leverage limits from investment banks, allowing them to go from 12-1 leverage to 40-1. It was deregulation in the form of the CFMA that allowed for the derivatives market to grow unchecked. It was a lack of regulation that allowed for loans to be made without regard to the borrowers ability to repay.

Deregulation just to say you deregulated something without regards to the consequences can be just as harmful as excessive regulation.

[AVGWarhawk]

The decline of GM is a testament to how poor strategic decisions over the course of decades will ultimately lead to collapse. The United States has followed the GM model of failure for the last three decades. The U.S. has too much debt, too much bureaucracy, too many government supported industries, too many agencies, too many employees, and $53 trillion of unfunded future liabilities. See any similarities to GM? Can the U.S. avoid the fate of GM, or is it too late? If we can learn the important lessons of the GM decline, it may not be too late to reverse our course. Or we can continue on the current path and follow the advice of Will Rogers.

American carmakers have seen their market share drop from 85% in 1985 to 43% today. GM’s market share peaked at almost 50% in the 1960’s. It reached a historic low of 19.5% in January. Their sales plummeted 49% from a year ago. GM has too much debt, too much bureaucracy, too many plants, too many car lines, too many employees, and too many future healthcare and pension obligations. Of course, the only way a company can be in such a disastrous position is through decades of mismanagement. The only logical solution is for GM to enter a pre-packaged bankruptcy with financing provided by the U.S. government if bank financing is unavailable. Shareholders and bondholders will be wiped out. They made a bad investment. Plants will be closed, UAW contracts restructured, management replaced, employees fired, debt written off and future obligations reduced. A much smaller viable company that can compete in the 21st Century would exit bankruptcy in a year or two. A profitable, low market share is preferable to a high market share with billions in loses.

Simple....GM ran GM into the ground. There is no one to blame but themselves.

[SteamWake]

Originally Posted by AVGWarhawk

Simple....GM ran GM into the ground. There is no one to blame but themselves.

Well goverment mandates and standards and guidlines and cafe regulations and so on dident help much.

[mookiemookie]

Originally Posted by SteamWake

Well goverment mandates and standards and guidlines and cafe regulations and so on dident help much.

You mean the same ones that Honda, Toyota and Nissan have to adhere to? Why aren't they in dire financial straights?

[longam]

Originally Posted by AVGWarhawk

Simple....GM ran GM into the ground. There is no one to blame but themselves.

we'll you could blame one organization ... UAW, Unions killed themselves and so many companies in this country.

[Aramike]

Originally Posted by mookiemookie

You mean the same ones that Honda, Toyota and Nissan have to adhere to? Why aren't they in dire financial straights?

A huge lack of legacy costs.

I think SteamWake's point was that the COMBINATION of poor decisions by the automakers and government regulation is what brought this on. The foreign companies aren't facing the same combination. His post said that the regulations "didn't help" - he didn't say that the regulations are what brought them to their knees.

[Aramike]

Originally Posted by longam

we'll you could blame one organization ... UAW, Unions killed themselves and so many companies in this country.

Damned right!

[AVGWarhawk]

Originally Posted by SteamWake

Well goverment mandates and standards and guidlines and cafe regulations and so on dident help much.

And Toyota, Nissan, Honda, Scion, are doing well because......

[AVGWarhawk]

Originally Posted by longam

we'll you could blame one organization ... UAW, Unions killed themselves and so many companies in this country.

To a degree, yes, unions can crush a company. I believe the UAW is one of them.

[Platapus]

Originally Posted by SteamWake

Again name me one federal goverment entity that is run profitably, and efficently.

Office of the Comptroller of the Currency.

Trying to make a silk purse from a sow's ear. new GM add to begin airing Wed. June 3.

http://adage.com/article?article_id=137010