Chrysler and pretzels...

[ylexot (Premo)]

There was a time when it made sense for the auto companies to provide loans. They had money in the bank and they could gain interest on it by loaning it out. Now is not that time. If the financial services group doesn't have cash to loan, it should shut down. People can get loans elsewhere. Make a deal with a bank who can provide money for loans. If the auto industry rebounds and they have money to loan, start it back up.

[Larry Gude (Premo)]

Originally Posted by ylexot

There was a time when it made sense for the auto companies to provide loans. They had money in the bank and they could gain interest on it by loaning it out. Now is not that time. If the financial services group doesn't have cash to loan, it should shut down. People can get loans elsewhere. Make a deal with a bank who can provide money for loans. If the auto industry rebounds and they have money to loan, start it back up.

I'm always happy when people get what I see as painfully obvious.

[Larry Gude (Premo)]

Originally Posted by Tilted

Oh, I agree - I never meant to suggest that we should be loaning them the money. Just saying why I think the comments from industry officials as to why Chrysler Financial doesn't need more money now but may later, makes sense. It doesn't mean they aren't low on lend-able capital - just that they don't have any business anyway so it doesn't matter if they are low on lend-able capital. .

The point, my reaction, was to illustrate just how ####ed up they are for having this cavalier attitude and how ####ed up we are for accepting it.

We weren't talking about a healthy business or general business principles. We're talking about a ward of the state. We're talking about a welfare bum making us feel better by saying they won't need any more money from us until next weeks lottery and that they have enough cigarettes for today because they're not going on a bender tonight.

[Larry Gude (Premo)]

Originally Posted by Tilted

Oh
Edit: I meant to add - when we agreed to loan GMAC money, they apparently didn't qualify to get it. They needed to get some of their debt holders to convert debt to equity in GMAC, so that they would qualify. They tried and tried, but had no luck. Finally, the government basically said, 'Oh yeah, you guys qualify anyway - no biggie - here's the money.' The private sector knew how bad an investment they were, and didn't want to have anything to do with owning part of them.

OR the private sector knew the feds would come in and make the thing more attractive. So, why hurry and be first in line at the buffet when the good stuff hasn't even been put out yet?

[Larry Gude (Premo)]

Originally Posted by Tilted

Don't forget, we are also loaning money to there parts producers, to make sure that they can continue to supply the parts needed to build the cars...

That part people understand. They can see covering payroll and helping pay for parts and supplies until things get better. That's the illusion that has been sold to the public; that they just need a little help through a rough patch.

GM is resisting making the HUGE changes in labor costs they needed to make JUST TO BREAK EVEN before they owed all this new 'debt'.

If their legacy costs are gone tomorrow, they still don't make money; they break even.

And that's before Obama tells them to make even more cars no one wants and less cars, pick ups, SUVs, that they actually make money on. And this doesn't include the new debt.

So, I'm looking for the feds to inherit the legacy costs AND find a way to forgive the debt.