Comments on: We Need Answers

By: Wayne Steiner

Wayne Steiner — Tue, 02 Dec 2008 16:28:07 +0000

Bailing out the big three auto makers would be a classic case of throwing good money after bad. If we want to bolster the auto industry in the USA why not give the $25 billion to the winners rather than the losers? An investment in Honda, Toyota, and Nissan, with the stipulation that they invest in USA production, would be a much more effective use of our money.

Has anyone in Washington even thought of that?

By: John H. McCammon

John H. McCammon — Wed, 19 Nov 2008 22:36:52 +0000

More left wing drivel from this journalist(?). Why is she still working for a supposedly reputable organization? It doesn’t matter what administration is handing out the cash in these already failed bailout schemes. Does she really think that SUV’s ever really defined success in this country for the majority of Americans? How shallow can a person be?

By: Don

Don — Wed, 19 Nov 2008 22:01:58 +0000

No, you are not crazy. There is only one solution. As Andrew stated, any more money from here goes in AFTER restructuring; or AFTER banks have written down mortgages and the homeowner’s payments to 38% of income (hopefully they have some income; if not forclose). Any negative amortization gets paid back to the bank before homeowner has a gain in the future. Take the hits now all at once, don’t dribble write offs over time. We need to find the bottom, so we can rise again with responsible management that takes only prudent risks with other people’ money. By the way, why is the CRA Act of 1977 still on the books? That Act and lack of discipline to regulate the massive growth of FNMA and FHLMC are the cause of this bubble, SO REPEAL THAT ACT.

By: Jack Frayer

Jack Frayer — Wed, 19 Nov 2008 21:32:51 +0000

Your right about Sheila Bair. She’s the only one that has presented and tested a plan to actually reduce foreclosures. I am not a big fan of her,though, because of her hard-handed approach with WAMU. Her plan will only help the overall problem; but, it won’t fix it.

At least one US auto company needs to survive. Where are we going to make our tanks and military vehicles if we need to ramp-up production? It’s a real national security issue. I agree with Pickens that we should force them to manufacture cars that reduces oil consumption. There should be big financial incentives for the consumer to make this an economic reality. Unfortunately, the US auto makers are slow to change and some won’t have such a car available until 2010. Ultimately, some money will be needed for them to survive today; and for those that are ready, credits for oil consumption reduction vehicles will be necessary next year so that they can sell their products. Maybe they can even gain market share if they execute well.

The CEO’s just asking for $25B to continue their plan without talking of future support is crazy. They are all overpaid even with a %50 reduction. They want the same blanket check the financial institutions got because they recognize that fear is a great motivator.

The real economic problems seem to be the pensions and medical benefits of past union workers. This old model needs to be eliminated like was already done in most of the US. The expense will ultimately be passed into the US system. But, it just makes the retirement line a little longer. Mandating by agreement would be a little easier on the economy than filing for bankruptcy.

Where is our leader here? I have heard of nothing from the President other than it is up to Congress. For someone so concerned with national security, it greatly disturbs me that he doesn’t take action. A leader makes things happen.

By: Chris Davids

Chris Davids — Wed, 19 Nov 2008 18:41:07 +0000

Alexis,

This is getting so sad…our Politicians and just about everyone else are pointing fingers, running, hiding and asking for More More More!!!!

There is ONE and ONLY ONE simple solution to getting the Economy BACK.

A Trillion and One Half Dollars MUST be injected into the economy and they MUST “LOAN” these Car Companies and the other Nuts the Money with VERY STRICT GUIDELINES!!!!!!!!!

The Unions need to start waking up…..A guy putting a wheel on a Car will simply not be able to make $70/Hour in USA anymore.

While they pick their noses on Capital Hill, us small Business owners are failing!

Banks must either Loan or give the Money BACK NOW! Or the Government MUST appoint Lending Groups to Lend the Government Money DIRECT.

PAYROLLS MUST BE MADE!

These people are NUTS and like to talk all day about what to do.

They should be kicked out of Office.

ALL of them.

Thank You!

By: Bob Hoppe

Bob Hoppe — Wed, 19 Nov 2008 16:55:30 +0000

Not crazy but you forget we are dealing with Washington. For almost forty years now we have been given the slogan oil independence and we have gone from 20-30% imported to 70% imported; only in Washington is that a start at reduction. Just like the budget which is said to be cut when in reallity it increases each year but they claim it didn’t go up as much as the agencies wanted, so therefor its a cut. So why expect them to actually do anything they say. Except for when it comes to raising taxes which somehow they manage to do. As for deflation, when you take out the decrease in the cost of fuel it is only one tenth of one percent which is hardly a major move.

By: john

john — Wed, 19 Nov 2008 16:15:30 +0000

no bailout for anyone, and definitely no stimulus package. Quit spending my money(taxpayer).
I was not for the $700billion, but now that it is there and law, help the homeowners and not the fat cats.
Any fat cat that gets a bonus should have the funds withdrawn by the government.
I fear that come January the big give aways will begin.
All those who voted for the fat cat union loving demos will get what they want, which will be doom for the free market.

By: Larry

Larry — Wed, 19 Nov 2008 15:47:10 +0000

A couple things:

The unions just make the cars that management/marketing think will sell. From the above, the big 3 are already making LNG/NG vehicles. Why aren’t they marketing them in the USA? The assembly lines are already there and so is the demand. Congressional help to develop the infrastructure for LNG/NG would be infinitely better than giving $25 B to the automakers. It would help with long term marketing strategy.

Giving the automakers $25 B will do nothing to change the current management thinking. Sen. Shelby is correct in that they (the investors) need to fire the CEOs for running the businesses into the ground. [That is not the union's fault.] The new bankruptcy laws will prevent the CEO from pocketing taxpayer bailout money in the form of bonuses (remember financial group that blew $400K at a spa after the bailout???!!!).

The CEOs are motivated (read bonuses) by short term (Q to Q) results and not long term as well as the institutional investors who just want a return on their money. The workers are there for the long term hence the retirement and healthcare in their contracts. Those goals work in opposite directions. Until the management starts looking long term there will continue to be failure in the auto industry.

By: Kevin B

Kevin B — Wed, 19 Nov 2008 15:09:47 +0000

You’re not crazy. Americans can recreate its auto industry for the good. The big 3
wont do it until its forced to. Throwing good money toward an oversized disfunctional
auto industry is bad. Seems America may be getting a new ballclub, via the big 3 its
new name? the Detroit Pirates.

By: Burnsie

Burnsie — Wed, 19 Nov 2008 14:46:47 +0000

No, Alexis, you are not crazy. This whole episode is causing thinking people to approach issues, questions and therefore, solutions in a new way, it just feels crazy. It is sad when companies will adjust their charter to line up for gov’t/our funds in this “bail out”. I hope some good learning and some good ol’ fashion shame and some solid indictments comes out of this. Our country will survive but in what state? I wish our country felt some strength and operated from a position of it and not out of fear or crisis mindset. Decisions made in haste rarely workout with the original intent.

What’s pleasing to the eye
In the delusion of my sight
Is not what I find when I reach into the light
I have lost my mind
I’m walking through time
Deluded as the next guy
Pretending and hoping to find
That distant peace of mind

- Beastie Boys