Could the Detroit 3 Become the Detroit 1?

http://www.businessweek.com/lifestyle/content/dec2008/bw20081211_580276.htm?chan=top+news_top+news+index+-+temp_news+%2B+analysis


GM to temporarily close 20 plants to slash output

http://www.businessweek.com/ap/financialnews/D951BEGG0.htm



Financial crisis of all time is also not yet over. Big players like Bank of America, Citi Bank, J P Morgan chase have terrible 4 quarter results and Morgan Stanley and Goldman Sach might not have any other option but to get merged. Credit losses in US alone is to the tune of 3 trillions.

Layoffs continue in almost all sectors including FMCG.

Latest announcement from the Federal Reserve where they bluntly stated that the sky’s the limit on how much money banks can borrow. And other central banks, including the Bank of England, European Central Bank, Swiss National Bank and Bank of Japan are joining in to basically give away money.

That’s right, no limit! It’s like the Central Bankers are running a casino, and the big banks — the same jokers who blew it all on toxic debt — are being given endless lines of credit to keep on gambling with no fear of losses.

Over Twenty five trillion dollars in global market capitalization wiped out from the world and More than $8 trillion of stock market wealth has evaporated from US itself. Trillions have been added to the United States' national debt.

The current bear market and economic turmoil have their own unique features that should probably keep investors cautious for a while. The global financial system is in the grips of a crisis not seen since the Great Depression. Investors have little idea what will fix the problem and aren't sure policy makers know, either.

Even economies thought to be immune, like China or Australia, are impacted. Even investments said to be safe, like corporate bonds, municipal bonds, certain money markets and large government-sponsored companies, are sinking.

Leaders worldover themselves are sounding the alarm. Unless they act swiftly, they say, the world as we know it today will fall apart. Thus, to avert what they fear could be the ultimate disaster, the governments of the richest countries have embarked on the most expensive financial rescue operations of all time. The U.S. government alone has spent, lent, committed or guaranteed $7.8 trillion. European governments have jumped in with another $2 trillion; China, $586 billion.

They’re bailing out bankrupt banks, broken brokerage firms, insolvent insurers and any company they deem essential to the economy. They’re pumping resources into mortgage markets, consumer credit markets and stock markets. They’re prodding lenders to lend, consumers to consume and investors to invest. They’re doing everything in their power to prevent a Second Great Depression.

They’re still trying to bail out nearly every major institution and market on the planet. Again, the big question: Will they succeed?

The quick answer: Yes, for a while, perhaps. They can kick the can down the road. They can buy time and postpone the day of reckoning.

Will they succeed in this endeavor remains to be seen?


Keep well,

Cheers!

Quote:

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Originally posted by pratickm

The union needs to gets down from its high horse and put their feet on the ground and face realities.
At a time of unprecedented economic turmoil when workers in all sectors of the economy are facing layoffs, pension and retirement funds are dwindling what gives them the right to make such demands?

It's time to stop the protectionism of the auto companies and let Schumpeter's "creative destruction" do its thing with all the auto companies, investment firm/banks, pooled pension funds, etc. who have gambled away their money on greed and now want to raid the tax-payer's money to keep living like robber barons.

In addition to the auto companies, the US and Canadian govt should not bail out the investment firms and the pension funds either.

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If you have a gun, you can rob a bank.
If you have a bank, you can rob everyone.
- Bill Maher

The issue is not whether Big 3 or any Financial company(s) or Real Estate company that has to be bailed out.

The issue is whether the concept of "Capitalism" is viable in today's terms. When Reagan made the famous speech of "Mr.Gorbachev tear down the wall" it was a significant statement of that "Communism" as a concept had failed.

When you have the right to ask the opposite "ism" to be pulled down, what right do you have to do a U-turn to protect these companies which have failed on their own mismanagement. This is the basic question which the Republicans have understood and will not be able to justify when they face their electorate.

When you have built your country by crying out loud that "Every man for himself" or "Live and Let Die" or rode to the wild west crying out "Yipeekayo" then you have to face the music.


The best statement on Socialism has been made Aravind Adiga by his book -"White Tiger" where he exposes the Indian Socialism and its grand failure!.

Incidentally 50% of the hedge companies will go under while most of the major banks are Bankrupt even after this bailout.

It is time for many of us to think about packing our bags to head elsewhere ?!.

BUT WHERE TO?.

Happy Holidays !.

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Sunny Leone a true Canadian DESI now back in India !.

Hi blorean,

Let's say, John owns a factory building bicycles and employs about 200 people. However, while his bicycles are being sold, the mismanagement of the company results in some accounting and other personnel issues. No doubt, he's paying the taxes on time. There's no Govt. control over his company as it's entirely a properietorship, or a public company listed on a stock exchange. His employees are enjoying a good pay with benefits and a supportive union. They are very happy. Suddenly, market collapses due to some unforeseen reasons and he also loses a big chunk in sales. Adding to it, the mismanagement and inefficient bicycles that John's company produced over the years. So, his business is in danger of closing down or on the verge of bankruptcy. I am highlighting again that it's a public/private company. Employees know that they do not have any job security in the private companies.

So, give me a single reason why Govt. must bail any company out with the taxpayers' hard earned money. Aren't the owners/management responsible for their own company's demise? Don't the employees already know they are working for a private company and there's no job security? Why the government is responsible for employees of a private company? I am working in a private/public company and know that my job is not secure. Tomorrow, if my company shuts down - I'll not cry to the Government to bail it out for my sake. I'll simply pack my bags, depressing over my fate and look for another job. So, why the autoworkers are that different than me?

I am dead against any bailout to these auto companies. I feel good when Harper takes a tough stance against them and outrightly rejects the demand.

Sadly, and nevertheless I am foreseeing the bailout, while my property taxes are going up in the coming year. NO BAILOUT FOR ME FROM MR. HARPER OR ANY FUTURE GOVT.

Highly unfortunate times.

Febpreet:

I get your point.

But the major difference between your job and the auto-workers' job is that they are part of a union. Part of the union's responsibility is to protect the wages of its employees. It is the duty of a union.

And that's all they are doing.

There are many other such upsides to being a union worker as well.

To your point, that's precisely what right-wing-union-hating america is doing now. Taking advantage of this mess to come bearing down on the unions. That is what I have a problem with. The devious political games that are going on now is ridiculous.

It took the congress/senate 4 days to grant 700 billion dollars to financial institutions. And now 15 billion is impossible to give unless the union takes a hit? Come on...do you think that is fair?

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If you have a gun, you can rob a bank.
If you have a bank, you can rob everyone.
- Bill Maher