ddavid

Good thing us Individual Investors didn't buy CIT.

"I hope that the players in the huge CIT volume the last few days really lost their asses on this one."

Oh your such a wonderful kind person.
(Sorry - I don't own Cit shares to help inflate your ego)

Should CIT Be Saved? I Think Not

Anyone that says small businesses can continue to operate as usual while its lender is in bankruptcy doesn't know much about bankruptcy nor is acquainted what a business environment entails.

Namely, the credit lines which have been established will freeze during bankruptcy. Small businesses need operating capital the same as large companies do. There are almost 1 million small businesses that rely on CIT with established credit lines to purchase raw materials and inventory to produce a product or services. It would not be unreasonable to estimate that several thousand of businesses out of a million could run into problems themselves or even its own bankruptcy if CIT fails.

It's preposterous to save the fat cats on Wall Street while the small business owner with several hundred employees could end up in the unemployment line. A Small Business is considered to be a net profit of $6 million or less for 2 preceding years - that takes in a lot of companies such as Baskin & Robins for example. CIT is the No. 1 lender to SBA and such would produce a large gap. Small Businesses also pay a larger share in taxes than large corporation per IRS -- do your research. Also 40% of large companies don't pay any. Read your IRS pages and there is always Google to find data.

I don't agree with bailouts but there must be a level playing field otherwise the system is corrupt and looses respect, and therewith future taxes not to mention loses to 401K`s and investors who in the past seeked bonds for safety and stability.

With attitudes that its OK to bail out those that caused this mess, the fat cats, but not Main Street we might as well teach each other and our younger generation how to milk the system. Yes, I know quite a few that do, managing rentals. Have your rent paid for 90%, food stamps, welfare payments, and let the consumer contribute to their utility bills. That 25 year old Lady I talked to this morning was heading to the beach while I worked my as*s off -- but that is what this country is coming to when our leaders are corrupt themselves then they teach corruption by example.

Obama's Economic Fix

What the public understands is when they read their monthly bills. Prices supposed to go down in a recession, but their not. The Democrats can't understand how to fix this economy either because all they know is how to spend money -- I'm saying that after reading the contents of the "Stimulus Package" which is laden with pork. (No political pun meant).

IF, and if the stimulus package has something in it for the consumer, then I can only foresee a Zero Sum game, because taxes everywhere are going up from sales taxes to property taxes. From Vehicle fees to utility fees. I just today got notice my Trash bill is going up 10% and water & street sweeping will go up 8%. I don't hear wages going up anywhere near that. Obama signed his 1st tax increase this week signing "SCHIP" legislation, breaking his campaign promise not to raise taxes. The paper hardly talks about that -- the media is in love with him.

Congress can throw all the money it wants, it won't fix anything until that toxic paper is put in a cage. There is still to much fear in the Global system after Lehman's default and that fear will not disappear until all banks are on solid footing. The piecemeal approach doesn't work, it never has, it never will, whether it is in war, in business, or in a cancer ridden body.

Two Reasons Why Geithner's Plan Will Fail

There's too much pork in this stimulus plan. I can't see how money allocated (such as) for space exploration will help the consumer drive the economy again.
IRS data shows 57% of American Corporation haven't paid any taxes for the past 5 years (IRS chart only showed 5 years). In the meantime States are raising taxes from License fees to sales taxes, to property taxes - (myself, just today, got notice the trash pick-up is going up 10% and water another 8%. Obama also raised taxes for "SCHIP" breaking his campaign promise. ..... if, and if any stimulus will reach the consumer then it will just be a zero sum game. I see the stimulus package going down another rat hole going nowhere.

GMAC's Recalcitrant Bondholders

To answer the above posters. The Bond exchange was only offered to the "Institutional investor" because it would be a nightmare contacting hundred thousand individual owners of GMAC bonds, and also highly probable that many could not be reached. Hence even individuals who carried a Cusip on the list were not permitted to exchange for legal and streamline reasons. I'm positive had GMAC allowed individuals to participate it would have reached its desired goal to obtain 30 Billion. The only reason I can see is time constriction; it may have been required to run advertising for a required length besides letters to investors. I'm sure there were good reason -- but doesn't speak well for its corporate officers not to plan ahead.

Bail Out Capitalism, Not Detroit

It must be easy to babble on; How much intelligence does it take to take the word of the media or blog site speaking wages of the big-3 autoworker

First of all the wages start about $14.00 and go to $27.00 /hr.
Honda's starting wage is $18.41 an hour.

The difference are Health and Retirement costs in the amount roughly $44.00
That cost covers two (2) workers - the present worker and the pensions and healthcare costs for the thousands of retirees on their books.

Hence the wages are much at par between GM & Honda & Toyota. It is the Pensions and Health care that the Japanese automaker does not have, because the Japanese government pays for those costs.

In that respect the Japanese are subsidizing their Autoworker.
Perhaps if we ever have a National Health Care System, the Automakers can have room to breath for true competition.

The solution is difficult. Again it is easy for the ignorant to repeat the media or blogger that GM et. should go into Chapter 11 without taking into consideration the huge costs and time. Lehman little unit in England will take 1 year at $10 million dollars a day. Delphi has been in Chapter 11 four years, and its not even close the size of GM, let alone all 3 automakers. Section 346 of Debtor financing will require billions of dollars. - a reason 2000 companies this year have chosen Chap 7 because its is impossible to get Debtor financing in this credit environment. GM et. option to go into Chap 11 would require government subsidy.

To show the difficulty GM et. failure would have on the supply line,
Honda spokesman Jeffrey Smith said Honda supports government aid to the big 3 because it would maintain the stability and viability of the auto industry as a whole.

The quickest fix, at this moment without giving deeper thought, would be to place an excise tax on foreign auto's - in the same amount as Health & Retirement costs are of the American Automaker.

A point to remember, irregardless which foreign company operates in the USA,
the profits are either returned to its country of origin or invested in US Treasuries. None aids the Trade deficit which increases the National Debt. So you & I loose any which way you care to slice it. Who else is there to pay the debt ?

Bail Out Capitalism, Not Detroit

It must be easy to babble on; How much intelligence does it take to take the word of the media or blog site speaking wages of the big-3 autoworker

First of all the wages start about $14.00 and go to $27.00 /hr.
Honda's starting wage is $18.41 an hour.

The difference are Health and Retirement costs in the amount roughly $44.00
That cost covers two (2) workers - the present worker and the pensions and healthcare costs for the thousands of retirees on their books.

Hence the wages are much at par between GM & Honda & Toyota. It is the Pensions and Health care that the Japanese automaker does not have, because the Japanese government pays for those costs.

In that respect the Japanese are subsidizing their Autoworker.
Perhaps if we ever have a National Health Care System, the Automakers can have room to breath for true competition.

The solution is difficult. Again it is easy for the ignorant to repeat the media or blogger that GM et. should go into Chapter 11 without taking into consideration the huge costs and time. Lehman little unit in England will take 1 year at $10 million dollars a day. Delphi has been in Chapter 11 four years, and its not even close the size of GM, let alone all 3 automakers. Section 346 of Debtor financing will require billions of dollars. - a reason 2000 companies this year have chosen Chap 7 because its is impossible to get Debtor financing in this credit environment. GM et. option to go into Chap 11 would require government subsidy.

To show the difficulty GM et. failure would have on the supply line,
Honda spokesman Jeffrey Smith said Honda supports government aid to the big 3 because it would maintain the stability and viability of the auto industry as a whole.

The quickest fix, at this moment without giving deeper thought, would be to place an excise tax on foreign auto's - in the same amount as Health & Retirement costs are of the American Automaker.

A point to remember, irregardless which foreign company operates in the USA,
the profits are either returned to its country of origin or invested in US Treasuries. None aids the Trade deficit which increases the National Debt. So you & I loose any which way you care to slice it. Who else is there to pay the debt ?

GM: Buyout Better than Bailout

Germany is supporting Opel. The EU is supporting their Auto Industry. Who in the right mind wants to loose more American manufacturing ? Yes China does, and the Japanese do, & European are gleaming at the thought another industry hits the dust in good ol' USA.

Now we want to sink Citigroup a Global Bank. We're already heading downhill in financial power. GE next ? Oh my, 100's of companies are leveraged, that has been the American way. You have so much pride in capitalism that your destroying Capitalism. So who will help pay off the National Debt ? The Japanese ? The Europeans ? Sorry those earnings will either go overseas or purchase more Treasury Notes, thus increasing Debt. And just because a foreign company employs an American worker here means diddly to the Trade Deficit added each year to The GRAND debt. China has overtaken the Japanese in holder of American debt.
China's earned new status -- it now owns nearly $1 out of every $10 in U.S. public debt Additionally, the more China & Japan invests in U.S. debt, the harder it becomes for U.S. companies to sell their products overseas. Soon enough (if not already) whoever owns the most Treasuries can manipulate and fine tune the amount of US Exports thru interest rates, and the increase & decrease of the dollar.
If Americans want the Auto Industry go in the same way as the Steel Industry, the Textile industry, and the list goes on (too long to post). I can just picture the Rating Companies downgrading the AAA rating on Treasuries. And don't think that will never happen. We need to have a larger picture and a goal, irregardless of today's costs if we want a brighter future.

No different from the massive debt West Germany has burdened itself to merge East Germany. To help GM is a pittance what it took to merge the West with the East - and look at it today, its the strongest economy in richness and will always be, because the future is more important than today.

General Electric: Genuine Risk of Collapse?

A well written article on the Negative side. I would have liked to hear the positives too. We all know (or should know) the whole American economy (both individual & corporate) are highly leveraged. That's been the American way of life.

We can pick on 100's of companies, the question is: How companies many companies do the hedge funds and short seller like to sink ?, until there is nothing left ? Our worry should be how to increase exports, rather than trying to reduce this nation to rubles. No one appears to care for the future, well I'm sure China has a long term plan.
China's new status -- it now owns nearly $1 out of every $10 in U.S. public debt Additionally, the more China invests in U.S. debt, the harder it becomes for U.S. companies to sell their products overseas. A foreign company here in the US may well employ you, (and help with employment problem), but it does not help the National Debt visa vi the Trade Deficit. Those earnings go either overseas or are plowed right back into Treasury Notes, thus increasing our debt.
And those creditor now have enough (1.9 Trillion China alone) to influence the interest rate and thus can fine tune exports & imports.

Why don't you short the whole nation and look your kids in the eye at same time. Talking about greed, market manipulators have more than greed - they have the poison to cripple capitalism as we know it.

Challenges Facing Obama

Agreed very few make over $250,000 but those that do (about 5%) make millions if not multi-millions. Those that make near 250K may well pay no more than being in the 60K range because they have earned exceedingly to invest in tax deferred or tax write off investments. Besides if anyone has any accounting knowledge you should know that each $100,000 above $250,000 will only have net taxable increase of $4.69 per hundred thousand.

I don't like to see it, yet the only solution to reducing the National Debt would be a National Sales Tax or Value Added Tax. All other method are only a
band aid. Wealth has become so disproportionate it may need a tax on its own, for I can show you how to make a Billion in wealth tax free, and withdraw only a taxable amount which I intent to spend. With a $150,000 I can live quite comfortable and take my annual world cruise.

dd

On Nov 05 08:48 AM Crank Monkey wrote:
> Very few people make over $250,000 and they pay the lion's share
> of the taxes already. Making them pay even more if a losing proposition.

Expectations the Obama administration will make saving the auto industry a priority could help ailing automakers, Barron's Bob O'Brien says. With a strong union presence, and as a lynchpin in the move to cleaner energy, they seem well-positioned to savor the incoming president's capital largesse.

We don't have a choice not to aid the auto industry. If we don't the downward spiral can only accelerate thus spreading the embers to other industries.

Two World Views: Buffett vs. Lahde

Not long ago - 3rd Qtr 2007 Warren thought the dollar was going to hell.
He suggested NOT to use Forex to hedge against the dollar fall but instead to buy good Foreign Stocks. That way he protects himself against the dollar, with the benefit of dividends & stock value. I'm very surprised he did an about face to invest here so quick. His favorite norm of operation is to purchase convertible preferred which pay high negotiated dividends. Also, by now at 80 I doubt Warren keeps large dollar reserves in his name, those investments have already been transferred to his Foundation and in Berkshire. Foundations pay salaries with which I'm sure he lives comfortably.
But I hope he is right, our corporations will disappear, especially if more shenanigans by hedge funds torch more institutions as they torched Lehman.

GMAC's Results Show Declining Used SUV Values

In case the posters have forgotten - Capitalism drives greed, and Greed drives capitalism. People are just as greedy as corporations. I do agree CEO's make way too much money, but that is the fault of the Board and Shareholders. If you got a $100 dollar an hour raise, I can just see you jumping with joy but never giving a second thought whether you deserve it. Society makes their own bed, so sleep in it or choose communism over capitalism. Nice to talk about greed of others but your just as guilty by allowing it to happen.

Credit Freeze Spreads to Consumers: GMAC Will Only Lend Money to Prime Borrowers

Thank you for your article. Since you spoke of the Gloom & Doom of the economy when banks tighten lending standards, it would have been plausible had you added the your opinion of GMAC's survival in their new lending environment.
That would have rounded out your article.

Bailout Datapoint of the Day, AIG Edition

What I learned today its not the fact that AIG is has to cover the actual value of the underlying CDS, but that hedge funds tripled the insurance protection against the CDS in case of failure. That like insuring your house 3 times its replacement cost.
Just a note to pass on, if true ?