Peter Morici, a University of Maryland professor in a bow-tie, says that giving the Big Three automakers will "create another AIG." (He also says if Chapter 11 is put off, "the industry will continue to shrink.")
Comments
Comments hidden for your protection. Show them anyway!More Favorite Reads
Sep 15, 2009, 2:22pm
Technical Difficulties Prevented Warren Buffett From Saving Lehman Brothers
I sense some judgment from the Bloomberg reporter here re:...
More »Sep 15, 2009, 2:00pm
People! THIS TYPE OF PERFORMANCE DOES NOT MAKE PTJ WANT TO RAIN BUCKETS O' CHICKEN ON YOUR ASSES!
Tudor BVI Global: August 2009: 0.5% YTD: 12.5% ...as for...
More »
Sep 09, 2009, 11:27am
Goldman Partner's Neighbors Scandalized By Shirt Optional Parties
Goldman Sachs partner managing director Richard Kimball Jr. apparently got...
More »Sep 09, 2009, 10:15am
Job Openings At AQR! (UPDATE)
Ladies, if you've been looking to work under one of...
More »
Posted by guest , Nov 18, 2008 5:11PM
Two words. Pontiac Aztek.
Posted by guest , Nov 18, 2008 5:14PM
Why the bum tag?
Posted by guest , Nov 18, 2008 5:14PM
Footage from the bailout discussions from capital hill:
http://hobochili.org/chili/?p=112
Posted by Lowly Assistant , Nov 18, 2008 5:14PM
I'm getting misty-eyed. Anyone remember the chevy/GM Typhoon? A pickup truck with a motherfucking corvette engine... With a little bit of gold and a pager...
Posted by Bess Levin , Nov 18, 2008 5:18PM
@2 it says 'burn' as in it's a diss to be likened to AIG.
Posted by guest , Nov 18, 2008 5:18PM
giving them what
Posted by guest , Nov 18, 2008 5:18PM
Friends, I just signed up for this great IB training course at the Swiss Finance Academy!
Posted by guest , Nov 18, 2008 5:18PM
He's an idiot. The trade with AIG is simple - AIG wrote tons and tons of CDS's and took in way too little premium to cover them. That cost them their credit rating and they are forced to pony up collateral all over the planet.
If the US keeps all of the assets underlying the AIG CDS's from going belly up over the next 3-5 years, AIG will get all that money back, and can repay the US taxpayer.
Get it? We (the taxpayer) is all in now. If GM goes down, AIG has to pony up.
GM has no hope of paying back a $25B loan. GM is a social program that makes some cruddy cars. Letting GM die is just like cutting off Medicare. We should euthanize GM and friends but in a way that doesn't totally fuck up the rest of the economy and society in the meanwhile.
If you let GM crash hard, it's going to cause panic in the financial markets, screw over their counterparties, move their pensions to the PBGC, and put a lot of people on the short-term welfare rolls. So you, Mr. & Mrs. Taxpayer are going to pick up the tab for that. Better to wind them down quietly and not deal with the costs of Chapter 7.
Posted by guest , Nov 18, 2008 5:20PM
@5 Bess- my bad-*adjusting monitor*-thx
Posted by StillNoCouch , Nov 18, 2008 5:25PM
I'm sure somebody cried when they stopped making AMC Pacers too.
Posted by Clown Capital , Nov 18, 2008 5:47PM
@#8
Jay-Z: "Get ya weight up; Not ya' hate up..."
Posted by guest , Nov 18, 2008 5:51PM
I believe Umbro has a meeting with congress later this week. Sure hope tax-payer funds can make them relevant as well.
Posted by guest , Nov 18, 2008 5:53PM
So far as job creation is concerned, let them dig ditches with spoons for $50 an hour. Same busy work, same job creation, same waste of tax-payer money.
Posted by guest , Nov 18, 2008 6:12PM
Morici can't even get (isolated) AIG stories right. Besides - it's a ludicrous comparison, AIG has actually been profitable in the last couple decades.
Posted by guest , Nov 18, 2008 6:13PM
#12- umbro got acquired by nike. they don't have delusions of grandeur and still make brilliant boots.
Posted by guest , Nov 18, 2008 6:16PM
@13
"Infrastructure improvements"
What do you think all these auto workers are going to be doing in two years?
Posted by guest , Nov 18, 2008 6:26PM
@2,5,
Or Burn as in cash. As in massive massive shitpiles of cash. Burning.
Posted by guest , Nov 18, 2008 6:30PM
@ #17
#5 has a name: Author.
So I'm going to venture a wild guess that this was the actual intent of the burn tag.
Posted by guest , Nov 18, 2008 6:38PM
Who is the good Senator who is currently ripping the beggars apart?
Posted by guest , Nov 18, 2008 6:41PM
Chris Dodd applauds and commends paying workers at idle factories 95% of the usual wages and all benefits!!!!!!!!
Posted by guest , Nov 18, 2008 6:41PM
Anybody remember those Oldsmobiles (or Buicks, maybe, can’t recall, they all were all the same) from the 80’s (I think) where the rear axle would get a few inches out of alignment and you'd have all the mean-looking old-fart white-hairs driving sideways down the street? God, nobody designed cars like GM. And we don’t want to help these guys? What’s this great country coming too!?
Posted by guest , Nov 18, 2008 7:33PM
You'll notice no one is talking about the engineers who build the components of alleged automobiles produced by GM, Ford and Crashler.
The engineers have gotten off too easy. OK, who was the lead engineer designing the Chevy Astro Van?????????
They ought to get him/her on illegal dumping charges for all the spontaneous disassembling those cars did on America's highways.
Posted by guest , Nov 18, 2008 7:39PM
@18 no your wrong. #17 is wright it could mean burn as in cash that's burning that reffeerres to the burns tag in the header. Do you dont need to venture a wild gues.
SPODE
Posted by guest , Nov 18, 2008 9:00PM
Misunderstanding of AIG aside, Morici made the auto industry guys look like fools in that hearing.
Posted by guest , Nov 18, 2008 9:03PM
AIG was done in by hubris. On the CDS front, they were on only one side of the trade - writing protection on the super senior portion of CDOs (isn't an insurance company supposed to know something about risk management?). They were also complete pricks when it came to negotiating CSA agreements. They were AAA at the time and most of their swap counterparties were AA or A. The collateral posting requirements are what did them in. I guess they assumed they would be Aaa forever.
Too bad because there are actually some good people still there.
Posted by guest , Nov 18, 2008 9:41PM
I switched my Impala from gold to chrome daytons.
Posted by guest , Nov 18, 2008 11:03PM
25
It's still incredible to me that AIG apparently never did any risk management on thier collateral posting, despite that being potentially fatal to the company. But from everything that's come out, that's exactly what they did.
Posted by guest , Nov 19, 2008 1:12AM
GO TERPS!
TAKIN' IT TO THE HEART OF THE RETARDED CAR INDUSTRY CHIEFTAINS. BOOYASHAKA!
Morici did a great job asking probing questions today on Capitol Hill that the panel couldn't evade. Smith School represent! Haha.
Posted by guest , Nov 19, 2008 9:03AM
@1 says it all. Bottom line - the Detroit 3 make piece of shit cars that NO ONE WANTS TO BUY! If it wasn't for fleet sales they all would have been dead years ago.
By the way, did anyone see CNBC this morning with Jerome York and Mike Jackson? GM has 8K people a day in the jobs bank? What a joke.
This is their own doing. Let them rot.
Posted by guest , Nov 19, 2008 9:11AM
#18 = Back Office = Inability to think outside a small shallow mildewy box.
Posted by guest , Nov 19, 2008 9:25AM
If GM fails, there won't be any dunk riders left by 2020.
Posted by guest , Nov 19, 2008 9:57AM
Let's play a game called "why we shouldn't give US automakers money." I'll list some clues, and you figure out the answer. Here we go.
Chevy Cavalier - Toyota Corolla
Pontiac Aztec - Honda Element
Dodge Neon - Honda Civic
Chevy Malibu Maxx - Toyota Camry
Chevy Astro - Toyota Sienna
Buick (anything) - Acura (anything)
Chevy S10 - Toyota Tacoma
jobs bank - no jobs bank
Detroit - not Detroit
Chevy Aveo - Honda Fit/Toyota Yaris
Ford Taurus - Honda Accord
Ford Windstar - Honda Odyssey
Ford Focus - Nissan Versa
Dodge Caliber - Toyota Matrix (OK, fine, Pontiac Vibe)
Dodge Stratus - Nissan Altima
Ford Escape - Toyota Rav4
Ford Contour - Toyota Camry
Posted by guest , Nov 19, 2008 10:06AM
32... Agreed
Posted by guest , Nov 19, 2008 10:10AM
SPODE - It must take a lot of work to purposely misspell all those words in your posts.
Posted by guest , Nov 19, 2008 11:17AM
@19
Richard Shelby, R-Ala, who publicly has been very adamant about not giving handouts to Detroit, Sen. Jim Bunning, R-Ky and Michael B. Enzi, R-Wyo. You have the Big 3 and the lackeys of the UAW, led by the Michigan caucus and the Democrats vs. Republicans who are representing BMW, Nissan, Toyota which have manufacturing plants in Mississippi, Tennessee and Alabama along the I-65 and I-75 corridor. Typical congressional partisanship – go figure - and it should be interesting.