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  #11  
Old 05-13-2009, 12:35 AM
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Independent Independent is offline
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Quote:
Originally Posted by kretinus View Post
If you think this nation could survive just the economic impact of letting all these companies fail, then I suggest you really aren't looking at the big picture.
Is this the first time a few large corporations have failed all at once? No. Will it be the last time? No. What usually happens after someone like Chrysler and GM fail? People start buying Fords, Toyota's, Honda's etc. Where are they being built? Right here in the good old U.S.A. Will the surviving companies need to hire more people to keep up with their new demand? More than likely. Will "new" U.S. automakers come into the picture? Probably. Will they be better and more efficient companies to keep up with the other surviving companies? Yes, or they will fail too.

This same scenario has been played out several hundred times since things have been being built and sold for profit. Our ancestors survived it, and we will too, it's all part of the way things work. Sometimes you have to take a step backward to move two ahead.

Stockholder and executive greed, along with corporate complacency, has caused a great deal of turmoil to this great industrial nation of ours, and unless something gets done about it, like the collapsing of a few industrial giants to wake us up, nothing will ever change, and that, IMHO, would be our biggest mistake.





Indy
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  #12  
Old 05-13-2009, 06:05 AM
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Quote:
Originally Posted by Independent View Post
The U.S. auto industry is small potatoes compared to the U.S. housing industry and nobody bailed anybody out there.



Indy
Guess I missed something.. seems a lot of banks ind insurers that passed out these toxic loans got bailed out... Now had these lenders not been allowed to get into hedge funds, and started tasting a lot of money, maybe they wouldn't have gotten so greedy and started taking so many chances and not passed out so many bad home loans and not needed bailouts...
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  #13  
Old 05-13-2009, 09:47 AM
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Originally Posted by simi View Post
Guess I missed something.. seems a lot of banks ind insurers that passed out these toxic loans got bailed out... Now had these lenders not been allowed to get into hedge funds, and started tasting a lot of money, maybe they wouldn't have gotten so greedy and started taking so many chances and not passed out so many bad home loans and not needed bailouts...
So, what exactly does any of that have to do with the people who build houses, plumbers, electricians, window makers, insulatation manufacturers, lumber yards, flooring companies, etc., I could name a few more hundred different manufacturers and companies "nation-wide" directly related to the housing market, but what would be the point. NONE of the bank bailout money has been going to the correct entities at all. Like I said, the auto industry "IS" small potatoes in all of this. Where do you think "most" of the 9.8% collecting unemployment right now are coming from? If you guessed directly, or indirectly, from the housing industry, you'd be absolutely correct. So, besides paying each other huge bonuses, what are the banks doing with the bailout money?

To be honest, I believe you and I, and everyone, are really on the same page on this, and something just needs to be done about it.




Indy
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  #14  
Old 05-13-2009, 11:13 AM
noonereal noonereal is offline
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Originally Posted by Independent View Post
Just for starters, how about less taxes as a result of NOT bailing them out for us, for our children, and for our childen's children, etc. Where did all that bailout money come from, and how are we going to pay it back?




Indy
The corps that borrowed the money are going to pay it back, with interest.
The money came principally from China.
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  #15  
Old 05-13-2009, 11:17 AM
noonereal noonereal is offline
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Quote:
Originally Posted by Independent View Post
Is this the first time a few large corporations have failed all at once?


Indy
It would not have been a few and yes it would have been unique. If you start from the premise that you did I would agree with your conclusions. However if you start with a faulty premise even sound logic will leave you with a bad remedy.
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  #16  
Old 05-13-2009, 05:35 PM
kretinus kretinus is offline
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Indy, I don't think this nation has ever seen the perfect storm we are seeing now, this is entirely different than anything we've faced in the past, even the depression.

If we let this crash, we see millions unemployed, which does nothing but compound the problem, we see the demand for social safety nets explode while revenue implodes, the end result being a nation where the wealth is now held by 1% and the other 99% slaves to those who hold the wealth.

And most the people who would suffer the most aren't likely to be those who share the most blame.

From what I can tell, your solution just causes more problems with no means of addressing them, it essentially tells everyone, tough luck, deal with it whether they had anything to do with it or not.

In todays society, I hope your prepared for a civil war because that will be the result, people have been pushed about as far as they can be pushed.
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  #17  
Old 05-15-2009, 10:13 AM
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Knock on effect

The problem with "let them fall" is not the percentage of workers put out of a job, it's the cluster effect. When a major car maker does down, it pulls all it's local specialist suppliers down with it. This has happened (albeight on a smaller scale) in the U.K. You get unemployment black spots where the percentage out of work is way above the national average. I don't know how your country deals with large scale unemployment in a relatively small area, but if it involves paying government money to people on zero income, how does this compare with the amount of cash the government would be using to keep the industry going? At the moment, even with heavy discounting your car manufacturers are producing more cars than they can sell, but if low emmision high mpg really is the future, and you've shut down the people who are tooled up to make them, you're going to be importing the damn things and watching your trade balance go down the pan.
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  #18  
Old 05-15-2009, 11:34 AM
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I don't see myself buying a new truck for a couple decades as being a pack-rat I collected enough parts to keep my two on the road that long.That is if gas is still avalible for them. By then, I'll be to old to worry about a car anyways.

Trade? Hell, I ran out of places to shop years ago, and really don't buy much since Made In USA is so hard to come by. I also carry two extra gallons of gas with me incase I'm out of town and need gas. That way I don't run out of gas looking for an American ran gas station.

Last edited by hillbilly; 05-15-2009 at 11:37 AM.
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  #19  
Old 05-18-2009, 09:50 PM
Charles Charles is offline
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The big picture

This may be a little off subject, but here goes.

What we have just witnessed is the near collapse of the global financial markets. Our currency is based on debt. When the loans started going bad, the banks were unable to meet their obligations.

So the Treasury and the Fed created trillions of dollars out of thin air to shore up the banks and restore the money supply. Nothing to it, they do it all of the time, just not of this magnitude.

So, happy days are here again. The banks are solvent, there's plenty of money, but why ain't everybody happy.

For one, our crappy fiat dollar is based more on faith than anything. Everyone expected bad times, and closed their pocketbook. They are short on faith. Things start going downhill for there. We also have a consumer based economy, if people don't spend , the economy stops.

Let's not forget inflation. The more of something you have, the less it is worth. We've got plenty of money, but it's going to be worth less and less as time goes along. I don't think the Chinese are very happy about what's going on, they're holding 2 trillion of US debt, when inflation kicks in, they're going to wind up holding the bag.

As far as paying it back, well, there ain't enough tea in China. The only way it can be paid back is through inflation. The hidden tax.

I'm really not doing a very good job of explaining this. Click on the link in my thread The Creature from Jekyll Island. That fellow can explain things so that even I can understand.

Chas
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  #20  
Old 05-21-2009, 10:06 AM
noonereal noonereal is offline
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When Bear Stearns collapsed, the share holders received $2 a share instead of the $30 a share it had traded at the day before. They were shocked and angered. Why?
Because the Fed did not want to reward bad management for bad management. At the same time they knew that allowing them to just fail would lead to world financial collapse. So they did what they though was best given two bad choices.

The same is true of later bailouts. Printing all this money is very bad but doing nothing in the opinion of the decision makers is worse. Two bad choices are all they had. The went with what they thought was the lesser evil.
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