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Trade Deficit Rises, Destroying More American Jobs
I question your premise for this reason only: in your first paragraph you signal that you are even more out of touch with reality than the consensus estimate on the trade deficit...why should I read any further, except to find more typo's!
Preview from Europe: Rejected Auto Bailout Tanks Markets
Let's Hope the Auto Bailout Has Failed for Good
On Dec 12 11:16 AM bosun.j wrote:
> The comments herein have convinced me once and for all that America
> needs to fail. To disappear. For good. Now.
>
> The extremist-capitalists and their zero-sum nonsense must be wiped
> from the face of the planet. Now.
>
> As they seem to truly believe that some have to suffer for the good
> of the system I suggest we start with them! Today! Now.
>
> Indeed. Americans represent only 5% of the worlds population. Americans
> consume 26% of the worlds resources. Americans cause 95% of the worlds
> wars. Time to fail. Now!
>
> I can't wait for the collapse. Everyday I wake and look to see if
> America has fallen, has finally gotten her karmic due. I won't have
> much longer to wait.
>
> Let's see the vitriol that these sentiments elicit! I'll bet the
> extremist-capitalist scumbags will howl the loudest! Indeed, it will
> be interesting to see them react to the very same hatefulness they
> are targeting the unionists with.
>
> Indeed.
Let's Hope the Auto Bailout Has Failed for Good
Not sure about the credit crisis lending to this issue. Qualified buyers, or those who have a history prior to this year of paying back their loans have no problems buying cars. The rub is in the sub prime market. Should we reproduce the mortgage debacle in car lending (again)?
If your house is being foreclosed upon, you do not need a new car no matter the manufacturer.
On Dec 12 08:25 AM EC48 wrote:
> John D is right and we should remember that the root cause of the
> problem are the financial institutions and the government who allowed
> the financials to operate in an irresponsible manner. If it wasn't
> for their greed we wouldn't be in this mess but I didn't see any
> of the CEO's of financials subjected to the belittleing, maybe somewhat
> deserved, that the Detroit automakers went through.
How Some of the Smartest Investors Turned Dumb in 2008
Happy Holidays!
Detroit's Bailout Invites Competitive Response from Abroad
On Dec 10 10:22 AM Thadeus Thornton III wrote:
>
> the Big Three
>
>
>
>
>
>
> Nothing needs to be said... Ford, Chrysler and GM's contributions
> after
> 9/11
>
> An interesting commentary...You might find this of interest:
>
> 'CNN Headline News did a short news listing regarding Fo! rd and
> GM's
> contributions to the relief and recovery efforts in New York and
>
> Washington.
>
> The findings are as follows.....
>
> 1. Ford- $10 million to American Red Cross matching employee
> contributions of the same number plus 10 Excursions to NY Fire Dept.
> The
> company also offered ER response ! team se rvices and office space
> to
> displaced government employees.
>
> 2. GM- $10 million to American Red Cross matching employee contributions
>
> of the sam e number and a fleet of vans, suv's, and trucks.
>
> 3. Daimler Chrysler- $10 million to support of the children and victims
>
> of the Sept. 11 attack.
>
> 4. Harley Davidson motorcycles- $1 million and 30 new motorcycles
> to the
> New York Police Dept.
>
> 5. Volkswagen-Employees and management created a Sept 11 Foundation,
>
> funded initial with $2 million, for the assistance of the children
> and
> victims of the WTC.
>
> 6. Hyundai- $300,000 to the American Red Cross.
>
> 7. Audi-Nothing.
>
> 8. BMW-Nothing.
>
> 9. Daewoo- Nothing.
>
> 10. Fiat-Nothing.
>
> 11. Honda- Nothing despite boasting of second best sales month ever
> in
> August 2001
>
> 12. Isuzu- Nothing.
>
> 13. Mitsubishi-Nothing.
>
> 14. Nissan-Nothing.
>
> 15. Porsche-Nothing. Press release with condolences via the Porsche
>
> website.
>
> 16. Subaru- Nothing.
>
> 17. Suzuki- Nothing.
>
> 18. Toyota-Nothing despite claims of high sales in July and August
> 2001.
> Condolences posted on the website Whenever the time may be for you
> to
> purchase or lease a new vehicle, keep this information in mind. You
>
> might want to give more consideration to a car manufactured by an
>
> American-owned and / or American based company. Apart from Hyundai
> and
> Volkswagen, the foreign car companies contributed nothing at all
> to the
> citizens of the United States ... It's OK for these companies to
> take
> money out of this country, but it is apparently not acceptable to
> return
> some in a time of crisis. I believe we should not forget things like
>
> this. Say thank you in a way that gets their attention..
>
> ++++ Pass it on, I just did. ++++
>
>
>
>
Autoworkers' Pay Only Small Factor in Detroit's Problems
This comment and the inherent sense of entitlement to twice the going rate says all we need to know about this issue.
For years this travesty has gotten worse to include defined benefit AND defined contribution retirement plans and the infamous Job Banks.
TARP, the Sequel: Auto Bailout
On Dec 11 09:06 AM Mike_I_N_Mich wrote:
>
> The following U.S. government policies, many of them having popular
> support, hurt the big three significantly relative to the foreign
> transplants:
> 1. Uneven union laws across states:
> a. The 1935 U.S. government Wagner Act granted the right of workers
> in the private sector to organize labor unions and take place in
> strikes. What this effectively meant was the labor unions were allowed
> to seize the plant and prevent its use until they got what they wanted.
> This created the ridiculous result in the US that workers are paid
> in proportion to the pain they can inflict by shutting things down.
> Trains, docks, garbage collectors, police, … get high pay. People
> in low capital or less critical to safety related industries like
> restaurants and retail get paid low paid. The relationship of pay
> to skill, work ethic, hazards goes away. Soon after the Wagner act
> the UAW took over the auto industry; GM and Chrysler in 1937; Ford
> in 1941. With no foreign competition the UAW monopoly flourished
> for about 30 years.
> b. The 1947 U.S. government Taft–Hartley Act tried to reign in the
> unions after a series of post-war strikes. While some provisions
> were national, the states were allowed to pass "right-to-work laws"
> that outlawed union shops. Such shops require workers to join the
> union and pay dues. Said state laws are serious impediments to union
> organization and viability because few people want to pay dues if
> not required.
> c. The vast majority of foreign owned plants are in right-to-work
> states providing huge advantages in labor costs and productivity
> relative to the big three.
> d. The big three would find it impossible to change the state laws
> where they are located due to union dominance of state governments.
> If they built in the South they have to accept the UAW because they
> would strike back in Michigan.
> e. No other country has this crazy system to my knowledge.
>
> 2. Promoted defined benefit packages and kept them in the company
> name. Did you ever consider how totally stupid it is to pin an employee
> retirement package, meant to last about 50-60 years from first hire
> until death, to the viability of their company? The top 10 companies
> in 1950 were very different than in 2000, with the railroads taking
> a big dive since then. And in 2020 it will be totally different again.
> Defined benefit packages were a bad idea, promoted by the US government
> till this day, and the big three are paying the price. If a company
> is in decline, due to the other items mentioned here, their retiree
> pool grows relative to gross income and number of active workers.
> Costs rise and competitiveness goes down, sales decline in a vicious
> spiral. Note also that while someday the transplants will pay pensions
> here in the US, the bulk of their corporate salary people (engineers
> for instance) back home get pensions from the government. Again,
> a totally crazy concept promoted by the Feds with widespread public
> support. And again, affecting the big three orders of magnitude harder
> than the foreign auto companies.
>
> In most western nations, if there is a defined benefit program, it
> is paid into a government fund and is divorced from the company.
> If the company fails, people don’t lose their pension. In the U.S.,
> the Pension Benefit Guarantee Company, a quasi-government / private
> company (like Fanny-Mae) supposedly fills in when the company goes
> belly up. But it is really a welfare program, with maximum limits
> far lower than promised pensions for many salaried workers. The airline
> pilots at United Air Lines, the current poster child of how wonderful
> chapter 11 will be for the big three, got screwed out of a large
> percentage of their “guaranteed” pension. Apparently the courts have
> ruled bond holders have first dibs on people’s defined benefits supposedly
> “held in trust”. What a travesty; only in the worse run country in
> the western world. These plans were in lieu of 401k plans. They are
> not deferred compensation as some say. There is a pot of gold with
> the employees names on it.
>
> See the PBS Frontline episode here for what happened at United.
>
>
> www.pbs.org/wgbh/pages.../
>
> All of you with defined benefit plans are in jeopardy. The Feds can
> fix these laws by simply making pension funding shortfalls first
> in line for bankruptcy allocations. Put the vulture chapter 11 lawyers
> and banks second in line after peoples pensions (which are essentially
> saving accounts).
>
> 3. No national healthcare. This is killing all US industry because
> we are competing with foreign companies with virtually no health
> care costs at home. Again, for transplants, the tens of thousands
> of such people at corporate headquarters are not in the U.S., but
> back home with free insurance. I’m basically a free market person
> but U.S. healthcare is so screwed up, and the employer based care
> creating such a competitive disadvantage, I give up – company paid
> healthcare must go and something needs to replace it. Watch for a
> future blog entry on that topic. Even though the transplants provide
> health care for their workers this is again an order of magnitude
> bigger problem for the big three because: 1) Corporate staff is back
> home with free health care, transplant workers are younger and therefore
> healthier, big three also pays health insurance for a million retirees.
>
>
> 4. Blunt instrument CAFÉ laws. The original purpose of CAFE was to
> reduce depletion of finite fossil fuel supplies and/or to reduce
> foreign imports. The Global Warming theory did not exist when CAFE
> was instituted but CAFÉ supports this as well. These same goals are
> achieved in almost all other Western counties via very high (on order
> of $3-$6 per gallon) federal gasoline taxes. That is the primary
> reason the cars are smaller in Europe and Japan. Our cowardly government
> did not want to be associated with taxes so instead wrote CAFE laws
> so the big three could do the taxing. I would argue that such laws
> fell, and continue to fall, disproportionately on the big three.
> The laws regulate an average fuel economy for a fleet produced by
> a given company. This forced the big three to abandon the cars they
> made money on, and build cars they don’t make money on, usually at
> a loss. The economics are simple: it takes as many overpaid UAW workers
> to put a door on a $14000 focus as a $30000 F150. So the bigger and
> more expensive the car the better the big three can compete. The
> above mentioned economic disadvantages of the big three are exaggerated
> on small, lower cost cars. And yes, people expect small cars to cost
> less. Screwed again by the feds! Ford, for instance, has trucks providing
> over 50% of sales. A rapidly increasing percentage of these trucks
> are used in the trades; try carrying a load of bricks or even a saddle
> in a Focus. Why does the Ford commercial truck have to go into a
> CAFÉ formula when a Mack Truck or Caterpillar dump truck does not?
> In the rest of the world, where gas taxes are used to reduce fossil
> fuel consumption, each company is allowed to compete in the part
> of the vehicle market where they do best. The customer takes the
> cost of gasoline with tax into consideration when he decides what
> size and features he needs, and then shops the brands that play in
> that market. With CAFÉ, the big three were forced at gunpoint to
> build and sell small cars at a loss just so they could meet the consumer
> demand for larger cars and trucks with their greater utility (carried
> more people for instance). The Japanese entered the market in the
> small car nitch where their low cost and experience from the sane
> countries with gas taxes gave them the greatest advantage. The Japanese
> became associated with small cars and better gas mileage, although
> for the same size car and performance there was no difference on
> average.
> It it were one or two of these items the big three might have competed
> better, but between the four the cost disadvantage in thousands per
> car and the hill too hard to climb. People seem to think Americans
> are superman, blessed with privilege, and the big three should have
> been able to overcome these odds against our oriental upstarts. In
> my opinion the big three did an amazing job lasting this long, as
> they are only mere mortals; doing the best they can given the stacked
> deck against them.
> In the end it is not the above items that are killing the big three
> right now. These items and the recent gas spike put the big three
> in a weak position, but they were recovering with the help of the
> UAW. Cars sell on credit, and there is no money available. Houses
> are also credit sensitive, but the housing industry doesn’t have
> the large capital equipment (factories, labs, buildings) and huge
> staffs (engineers…) to keep feeding when there is a drop in sales.
> And the housing industry is dominated by illegal alien workers which
> they just let go.
> This credit crisis in not of the big three’s making by any stretch
> of the imagination. The most likely biggest wrongdoers in the congress
> and the federal bureaucracy, will keep their jobs and pensions. The
> second biggest wrongdoers in the financial sector, are getting a
> trillion or so dollars of bailouts.
> The big three are asking for a 5% loan and all this hate comes out
> in the press and the web. The gap between perception and reality
> is staggering.
Holiday Stock Picks for the Unemployed Banker
These folks do not want to lose their jobs and jump (implying willingness) on any such trend.
Nationalizing Detroit
On Dec 09 11:34 AM James F. Newell wrote:
> This proposed Triple Benefit Auto Program would produce three benefits
> simultaneously for the same federal budget expenditure. It would
> benefit the economy, the auto related workers, and the poor.
>
> The program would involve providing federal money to unemployment
> offices across the nation to purchase and maintain cars to lend to
> low income individuals who did not have a car but needed one to accept
> a job. The cars would be purchased from Ford, General Motors and
> Chrysler. The cars would be lent to people for as long as necessary
> for them to get themselves into a financial position in which they
> could afford to purchase their own cars.
>
> If presented to the President elect Obama and Congress and passed
> quickly, it would greatly help resolve the current crisis and help
> prevent a much more serious decline in the economy.
>
> James F. Newell, Ph.D. U. Washington, Seattle
Great Shorting Opportunity, Care of Obama
Chicago Standoff, Redefaults Bode Ill for Bank Shares
www.azcentral.com/news...
The Case for Making Bigger Cars
On Dec 09 09:36 AM paulk8756 wrote:
> Detroit brought ALL of this upon themselves for the many reasons
> you folks cite and a myriad of others. The question is can they now
> turn it around? One would have to logically conclude the odds are
> against them.
>
> However, as we see in the news, the government is going to try anyway.
> Is this a good investment, one that a rational person would make?
> Hardly. But they're going to attempt it regardless.
>
> We'll get to watch this bailout process blow by blow as it unfolds.
> We shouldn't be surprised if it fails.
The Case for Making Bigger Cars
On Dec 08 12:24 PM mycargets52mpg wrote:
> 6 years ago, the B3B (Big 3 Bozos) were likely planning gasoline
> as of 12/31/08 to be what is was back then, about $1.60 per gallon
> Regular. That would have given them the confidence to keep producing
> whatever made money at the time.
Detroit's Failure and the Dollar