What happens when your homes value falls to pre 1980 levels how many owe more then $45,000 on their primary residence what will you say to the bank then?
What happens when the unemployment system runs out of money will you the worker support higher taxes to pay out of work car industry officials you may not have a choice?
What happens to retirees of the car industry when they lose their pensions and the federal government has to pick up the cost who pays that bailout?
What happens when your city or town has to close schools because of lost revenues due to high vacancies in the commercial district and falling excise tax revenues. Will we see 60 kids per room in an empty warehouse maybe?
What happens when we are sending $300 Billion oversees to Toyota, Nissan, Hyundai, Kia, Honda, etc… for cars and trucks to get to work in and the cost of these autos double as they ramp up to meet demand is a Kia worth $40,000 for a base edition. No competition why not?
What happens when, you need to think about it, before you jump on to the band wagon and say no to a bailout. Yes we can set terms just as we did as a country when our fathers and grand fathers returned from WWII and we were still digging out from the 1929 crash and depression look up the “Treaty of Detroit”.
What will you say now that American Express just this morning converted to a bank holding company in order to take deposits but also to take a bail out for the growing numbers defaulting on their Credit Cards you had no say in that one I wonder if the CEO gets his bonus for Christmas or how about the party for top execs for another years job well done think the shrimp will be a little smaller amybe?
How about MasterCard and Visa how far away are they from doing the same on a larger scale, say 10-1 larger, then the American Express bail out.
What happens when your company says their is no one left to buy our product their all out of work here is your two weeks notice sorry will you blame the guy or girl in the next work station or maybe the CEO how about those Wall Street types who bled you dry?
Will you speak up then? Will you make a call demanding a bail out or will you walk away from your home take what you can carry because your american made car is dead in the drive way and tell your kids and your wife to start walking? where will you go? what will you do? how do you restart if their is nothing to restart?
Ok, now that we are all thinking lets get down to business. Yes bailouts for dumb actions taste bad, really bad, it’s a taste that will stay with us for decades maybe longer. Yet the alternatives are dramatic look at the stories of the 1930’s at the struggle for survival, if your lucky enough to have a parent or grand parent alive who lived through it ask them to tell you what it was like, then go reread my questions many of them are based on stories from that time.
Brace yourselves our Economy is a house of Cards, because of greed and I believe fraud in the financial sector which created paper(yes Just Paper) that they claimed represented our full faith and credit and sold them as unregulated bonds and so called insurance deriviatives on bundled mortgage debt. And they did this over and over and over and over again to the point that they may have sold the same thing 10 to 20 times, maybe more. When it is all sorted out we may know the truth but this will take time. Yet as a result of these 2 decades of greed for commissions, bonuses and run away profits we are placed in the position of having to bail them out or lose our social economic framework.
Make no mistake 9 out 10 were indirectly involved in this scheme we in so many cases were un knowing of the lies being told and the shell games being played but we were lured in by the promise of a bright future, which one of us after working so hard would not jump at the chance to enjoy the fruits of our labor hey the same people who tell us day in and day out what to do for 40 hours a week were incharge why wouldn’t you believe them? Now you may not have been one who bought a home, you may not have refinanced it when it doubled in value, to buy a boat, or a plane, or a motorcycle, but you went out to dinner weekly instead of saving and living a Spartan life you may have contributed to the problem. Instead you should have been smarter ,right, you should have been in preparation for this collapse. What about those that sent your children to an over priced College or University maybe your almamatter and had them take out student loans to the tune of $20,000-$30,000-$40,000-$50,000….. with jobs now being lost and others jobs not being created how will they pay for them are they abunch of dead beats? Why didn’t you have the savings to send them to Dartmouth or Yale instead of borrowing? Why didn’t you see this comming and send them instead to Middlesex Community College and saved a bundle for this collapse.
Look this is Veterans Day 2008 a day when we not only remember the dead, but for many Veterans they remember those they served with and survived with. How no one was a hero but they built bonds unbreakable, bonds that when the time came demanded the ultimate sacrifice. for many who have not served we look at those bonds and scratch our heads some times and wonder why they support another veteran just because they are a veteran and we wonder why, even when they never knew the individual, yet they share a bond and they remember that bond is based on sacrifice.
Well the bail out, if you get down to the bare bones, is you and I helping out other workers maintain their dignity, the sacrifice they made going to work day in and day out doing what the boss commanded, you can not fault them, for the CEO mistakes. Instead it is time to DEMAND that the bailouts come with conditions on those who made mistakes in judgment and leadership, they have to pay a price, but not you and I and our neighbors we need to stick together. Currently the Administration has done little but bolster the fat cats and CEOs. Much like Firing the Privates and promoting the generals. These are the “Captains of Industry” who have made the mistakes that have brought us to this day and time. They have stuck to the same doctrine as the years past that “trickle down” will wash our problems away this is the frustration when we see what is now well over 2 Trillion dollars going to the top companies who started this problem and the reports of them reserving some of the bailout money for “Billions in Bonuses” this December again at our expense. I don’t think we are going to see a single assembly line worker get a bonus next month if we bail out the Auto industry do you? Instead you will see a thank full man or women who on Monday will get up and go to work and on Friday get a paycheck to struggle on for another week. Lets not forget that our economy is one engine yes in the past we have had sectors stumble and fall and pain was felt but they will pale in comparison to this event if and this is a big IF we can not stop the cards from all failing.
I will again raise my voice and suggest that Hank Paulson should be run out of Washington ASAP and his rewards to Wall Street should have new conditions, strict conditions, placed on them and for AIG’s Ceo and top Management team and the head of the financial sector should be forced to resign or be fired by those providing the bail out as should the CEO’s every institution who recieves a bail out including those of GM, FORD and Chrysler if they get a single US Dollar. New leadship needs to be put into place that realize that you can not repeat the errors of the past a new direction needs to be plotted. Letting a single one of them remain is an insult to the average American who gets up and goes to work tomorrow morning.
Best to ALL
amberpaw says
We also need to save unions.
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p>Remembering the 30sw, indeed. THIS family canceled its vacation in 2008.
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p>THIS family has been cutting, downsizing, and changing how it does business. We had to do so; almost 50% of our income came [and I do say “came”] from a small business that has also had to downsize, shift, and change focus to stay viable.
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p>Where Lehman Bros got a bailout, and its Chief Hog [a proposed change of term from CEO] was paid FOUR HUNDERED AND EIGHTY TWO MILLION [THAT’S RIGHT, $482,000,000.00 AND CHANGE] – serious “buck stops here” over sight with transparency is critical or the Chief Hogs will loot us and our children and our grandchildren – further.
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p>Maybe there is finally a job for Governor 9C cuts Mitt Romney??? Oversee those bloated corporations who are the new Welfare Cheats?
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p>Or who do you propose?
mr-lynne says
… to me why bankruptcy is an unacceptable solution?
amberpaw says
…for starters.
mr-lynne says
… ceases to exist. Bankruptcy doesn’t assume that. I’d agree that losing that many jobs is quite problematic.
woburndem says
Ok I can agree that Bankruptcy has advantages not the least of with is stopping payments to creditors and attempting to restructure debt. These two points are the key to relief under this US Code.
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p>I want you to think for a minute who has outstanding Loans tot he American Auto Industry. Well the list is extremely short they have very little if any bank debt, they don’t owe governments money, as an american blue chip stock as they wre called they have mostly large investors like State Pension funds and union pension funds mostly the main stream biggies. Small investors would be few and far between. so what are you going to negotiate here a lower stock price maybe. You could say that all of the componenat manufactures that have made and delivered products to GM, Ford and Chrysler will not be paid and left holding the bag so they layoff and shut down or file bnakruptcy and again the judge tries to collect on the outstanding invoices and the big three say nope don’t have it so on and so on and so on the cycle repeats until you get to the end of the line. Imagine the share number of layoffs and collapsed companies.
Lets look at a plan to restructure debt who do they owe? No one but themselves, from the last prospectus I reviewed.
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p>What do they need to get out of bankruptcy? They need 10’s of Billions to retool they need, Billions to keep their workers working, they need Billions to pay now bnakrupt and closed sub contractors and they need billions to write off existing inventory. Where do they get the money BANKS? are you kidding that industry is on Life support paying the CEO”S standing in the trough of Bail Out money.
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p>The real value of Bakruptcy does not apply to a Corporation even 3 Corporations that you are thinking about. it is again sorry to say this a key foundation industry that if you cancell it your three legged stool topples and on goes the house of cards. With out being to graphic or using a Bushism. Thry thinking about the World trade towers and why they collapsed it was because one key girder system melted under heat that was never designed to occur not because of the foundation failing yet it collapsed just the same. Well a plane hit our economy self inflicted by Wall Street correct but none the less just as catastophic maybe worse. When you think of it Bin LAden must be laugh ing at us we did to ourselves what he could not do to us.
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p>As Usual Just my Opinions
Best to All
mr-lynne says
So what we’re saying here is that bankruptcy is inadequate to meet their problems because relief from creditors solves too little of their problems.
sabutai says
But they also need to, uh, build cars people want at the prices people are willing to pay.
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p>Not that I know what I’m talking about, but were I GMC I would pour almost every penny into developed the Chevy Volt. That product could be the iMac of the auto industry if they pull it off.
woburndem says
Thank you that is the point of Bankruptcy relief from those you owe it does little if you owe little.
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p>Just my Opinions as Usual
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p>Best to All
mr-lynne says
… for a while there that nobody would answer the question about bankruptcy. Call me crazy, but if you want special bail-out money, I’d say it’s incumbent upon petitioners to explain (if not outright prove) why other solutions are inadequate or out of the question.
goldsteingonewild says
Hi there –
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p>What a heartfelt post!
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p>Question –
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p>If you could do it all over, would you have bailed out the US Steel industry in the 1970s and 1980s when it mostly died and we lost hundreds of thousands of jobs?
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p>
woburndem says
The loss of raw manufacturing such as the steel industry has cost the US in many ways not the least of which is the huge trade deficit we run today. The steel industry like the auto Industry made a number of critical errors not the least of which was the refusal to modernize. Here again the choices made by CEO’s in how they manage their companies proved incorrect and created a void and a vulnerability in our Economy.
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p>I would also love to see where it is written that to be a CEO of a major industry makes you a demigod and allows you to walk on water. We including my self look at these people as if they wear a halo and walk on water when they are successful. Ultimately I hope we come to realize that they are just as limited on any given day as any one of their employees and that failure can come to one of them as well just as easily. Yet for some reason we elevate them to a level above ourselves and reward them with a disproportionate amount of wealth.
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p>Some day we need to return to the CEO who looks at his company and realizes that with out all of the employees working for the same cause he is little more then a man or women standing in an empty room with nothing to do and no money to do it. Not everyone is cut out to be a CEO yet we all contribute to the success of the whole company the whole economy.
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p>As Usual Just My Opinions