ddavid

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.

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.