Obama is kicking ass!

**Fovezer** · 03-01-12, 12:34 AM

Originally Posted by ~BigTymer~

And on top of the bailout. THE FUCKERS MOVED JOBS OVER SEAS.... FUCKING AWESOME...

Under Restructuring, GM To Build More Cars Overseas

First, look at the date of that article, then actually read it. Thanks.

Originally Posted by CivilWars

America's largest airline is about as close as you are going to get to America's largest/second largest car manufacturer, no? They filed bankruptcy 11/11, so let's hand them some cash quick, before it's too late.

They filed Chapter 11 bankruptcy, which is something GM still did after the bailout, because they were able to get financing from US Bank Trust and are going to restructure the same way GM did. They are not going to liquidate or cease operation. If GM had been able to obtain private loans like AMR has, they wouldn't have needed a bailout.

See here: AMR Won

Originally Posted by ~BigTymer~

this pisses me off too
GM to award bonuses, in some cases exceeding 50% of salaries - Feb. 11, 2011

SERIOUSLY

and they didn't pay all the bailout money back Grassley: GM Didn't Really Pay U.S. Back

Stop using old articles if you want to be taken seriously. One is from a year ago and the other is from 2 years ago.

GM turned a $7.6 billion profit last year and is turning around. I'm not a fan of bonuses paid to CEO's and stuff, but I have no problem with profit-sharing, which is what GM is during this year. Oh, and Grassley is a tool. The loans are paid back, the outstanding debt is tied up in GM stock which the government is waiting to offload once stock prices rise.

**CivilWars** · 03-01-12, 01:11 AM

You are making my point. Why is someone willing to finance AMR? Because they see future profits. If GM, or some portion of it, showed a potential for future profits then the banks then, ripe with TARP cash, would have financed them too, without the government cash.

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**Warprosper** · 03-01-12, 07:01 AM

Originally Posted by CivilWars

I am sure no matter what company I name you will come up with some reason why it isn't the same as GM, so I will just agree to disagree.

imo there are three companies in this country that can not fail, under any circumstances. GM is one of them and then you have P&G, and GE.

**Fovezer** · 03-01-12, 07:49 AM

Originally Posted by CivilWars

You are making my point. Why is someone willing to finance AMR? Because they see future profits. If GM, or some portion of it, showed a potential for future profits then the banks then, ripe with TARP cash, would have financed them too, without the government cash.

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AMR has lost money for like a decade straight and GM happened in the middle of the financial crisis. There just wasn't the financing available at that time.

**CivilWars** · 03-01-12, 08:10 AM

So wait, we are pretty much all in agreement that TARP gave financial institutions shit tons of cash, which they just sat on, that doesn't even take into account LBO firms like Berkshire Hathaway, but yet there was not one single private investor in the world for a company that would be turning a sizable profit in 2-4 years? But now, the economy is so great that a company that hasn't turned a profit "in decades" can find private funding? Color me skeptical on that one. If your argument is that the government didn't want Detroit/Michigan to become more troubled than it already was/is, and they couldn't be certain that another investor/buyer would keep things there, then I might tend to agree with your assumption, but still disagree that it was the "right" thing to do.

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**Fovezer** · 03-01-12, 10:39 AM

Originally Posted by CivilWars

So wait, we are pretty much all in agreement that TARP gave financial institutions shit tons of cash, which they just sat on, that doesn't even take into account LBO firms like Berkshire Hathaway, but yet there was not one single private investor in the world for a company that would be turning a sizable profit in 2-4 years? But now, the economy is so great that a company that hasn't turned a profit "in decades" can find private funding? Color me skeptical on that one. If your argument is that the government didn't want Detroit/Michigan to become more troubled than it already was/is, and they couldn't be certain that another investor/buyer would keep things there, then I might tend to agree with your assumption, but still disagree that it was the "right" thing to do.

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"Bankrupt firms need DIP financing to operate--to pay suppliers, finance inventories and meet payroll--while they restructure. It is risky for DIP creditors even in good times, but they do get first dibs on the bankrupt firms' assets and can earn high rates and fees. But in a credit crunch such as we are experiencing now, nothing will convince creditors to take the risk."
How to Grease Detroit's Squeaky Wheels

"It is virtually certain that these companies and their suppliers would be forced to shut down, because no one would have stepped forward to provide credit to operate through bankruptcy without a government guarantee. "
Obama's Restructuring of the Auto Industry | Op-Eds & Columns

"...a private bankruptcy for automakers would not have been possible during the 2008-2009 financial crisis because credit markets were frozen and GM and Chrysler were unable to get private financing to keep operating through bankruptcy."
In Michigan, will Romney regret opposing auto bailout? | Reuters

"Free-marketeers that we are, The Economist agreed with Mr Romney at the time. But we later apologised for that position. "Had the government not stepped in, GM might have restructured under normal bankruptcy procedures, without putting public money at risk", we said. But "given the panic that gripped private purse-strings...it is more likely that GM would have been liquidated, sending a cascade of destruction through the supply chain on which its rivals, too, depended.""
Mitt Romney and the car industry: A Detroiter in his own mind | The Economist

That's the reality and that's what happened. You are free to reject it if you so choose, but you are not arguing with any facts.

**Xavsnipe** · 03-01-12, 11:20 AM

It might turn a profit but the payback will probably be 100 years or so lol. Thats why private investors wouldn't finance the bankrupt company

**Xavsnipe** · 03-01-12, 11:21 AM

And the IRR is probably close to 0

**Alundil** · 03-01-12, 12:24 PM

Originally Posted by Fovezer

Interesting factoid from that link?
"There are 78,000 tax filers with incomes of $211,000 to $533,000 who will pay no federal income taxes this year. Even more amazingly, there are 24,000 households with incomes of $533,000 to $2.2 million with zero income tax liability, and 3,000 tax filers with incomes above $2.2 million with the same federal income tax liability as most of those with incomes barely above the poverty level."

And those are indicative of a gross failure of the tax system as we know it in the states. But for people reading along, that doesn't mean they paid no taxes or very little $$ amounts in taxes, it just means that it wasn't based on "income (salary)" taxes. There is a big difference between no taxes, and no income taxes. Additionally, the last line there refers to federal income tax liability and compares high earners (not necessarily based on income/payroll) and poverty level incomes. Is there a detailed breakdown of how the author(s) arrives at that conclusion? It is federal income tax "rate" liability? Or dollar on dollar liability? There is sizable difference in those data points.

They devil, as they say, is in the details.

**Alundil** · 03-01-12, 12:38 PM

In many cases, the banks did not lend the government money out to private entities that needed it, but rather used it to pay down their own debt and shore up their own finances. Thus not using the government loaned liquidity for the purposes to which it was intended.

Originally Posted by Fovezer

That's the reality and that's what happened. You are free to reject it if you so choose, but you are not arguing with any facts.

Additionally, how it is that you are claiming estimates and opinions about what DID NOT happen as facts? I understand what you're saying. But there is no margin in the discussion to claim "I'm right and everything would've gone to hell in a handbasket without the money" as those things never came to pass. It's conjecture. It might be good conjecture. But it is still conjecture and not "fact" as you claim it to be.

I disagree with the notion that ANY company is too large to fail. Failure is a penalty of.....failing (in your business model, in your operations, in your planning). If the failure was wholly due to outside (government caused influences) forces, then there is some onus on the government to make that corp/entity whole but that gets settled in court. If, however, the failure is owed to poor planning or poor operation of the company itself then I think that the company ought to "pay the piper" for that. Everyone will be wiser the next time around. As it stands, there are fewer compelling reasons to manage risk now that there were before (for those "too big to fail companies) as they know Uncle Sam will pull their ass out of the fire if necessary and John Q. Public is left holding the bag.