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The Bailouts Are Doomed - All of Them
The derivatives/CMBS/CDS/R... Ponzi scheme was concocted by a few thousand finance MBAs. The housing bubble was caused by spenders mostly in CA and FL.
There were 220 million working & saving people who did NOT carry $30K of HELOC debt. In fact, of the dozen countries I have visited, the USA has more actual workers, and workers per capita, than any other. That does not sound like they are all lazy.
The point of the author is that bailouts are doomed. The failure and decline of the dollar is therefore predictable; and funds such as ULE or euro-banking companies such as SPWRB, JASO, STP are good investments.
There are penty of F-U-America, burn, baby, burn... blogs out there. Take your hate somewhere else.
On Jan 06 06:52 AM Sing Expat wrote:
> burn, baby, burn.
> Death to America, etc., etc.
> We all got what we wanted and deserved. It was a great party and
> we did not want anyone to take away the booze or tell us we were
> being too loud. Now it's seven in the morning and we have to clean
> up the mess. Our heads are pounding, we want to throw up. We don't
> need lectures or sermons. If we drank too much, it was the fault
> of the host who brought out too much booze, or the bartender who
> mixed them too strong, or the DJ whose rocking beat just made us
> want to dance and get drunk. Not our fault.
> Fuck you America. You sold out your future. You sold out a few countries.
> You sold out your morals, your principles, and your constitution.
> You deserve everything that happened and will happen.
The Bailouts Are Doomed - All of Them
Re: Vienna: "I hope the US will find laws to eliminate this [lobbying/corruption] to some extent.
There are hundreds of laws. The only one that matters - on any continent - is the law of cash flows.
Re: elroy: "Time for a fundamental change.....how do we do this?"
Go door-to-door, as I and a hundred others did. We removed the largest % of incumbents in our state assembly in a century.
Show people what the incumbents did and ***put a dollar amount on it.***
That is how you do it.
The kakistocracy must be fought.
Ironic Headline of the Day (Hint: It's about GMAC)
They allowed the conversion of companies, including GMAC, into bank holding companies whether or not the company met requirements.
They allowed guilty financial CEOs to retire with massive golden parachutes, then allowed the company to receive funds.
The US government is frothing at the mouth to give away nonexistent money. There is no good that comes from giving away other people's nonexistent money, except to those who least deserve to receive other people's nonexistent money.
Instead of getting a lock on tracking the funds, Treasury is awarding more funds to a badly-run company, so that it may loan [our] money to people who are less likely to pay it back on time.
Brilliant. This will fix everything.
Trading Obama: Solar Stocks, GM Debt, Ambac Calls, Lorillard and Goldman Puts
On positive notes, GM will be temporarily bailed out because:
1. People would be really mad if Wall Street bank bosses got bailed out, and manufacturers did not.
2. Although Chapter 11 would allow a permanent fix, people PERCEIVE the sudden layoffs as being more expensive to taxpayers, and politicians will dodge it.
3. Politics in the Rust Belt is made for supporting the UAW. Politics outside the Rust Belt are non-sequitar, since we have one-party-rule effective 20 Jan.
4. When I was a fiscal analyst, I ate lunch monthly with reps & senators (fed & state.) The government is going to do a bailout. It is how they think. It is all they know. It does not matter what we showed them. They will throw money at GM at least twice.
But the loan has no lift on your XGM or my BGM price because:
1. GM does not have the long-term ability to pay the coupon. GM bonds have the lowest credit rating possible. GM went from “bankruptcy is not an option” to admitting that their cash position will be less that the level needed to operate in the first quarter of 2009, plus they will need $4 billion in cash before next week.
2. GMAC is about to go belly-up. According to Barclays, if GMAC were to fail, GM could need an additional $9 billion to $13 billion in funding to supply financing to its dealers.
3. There are indicators that bondholders will be damaged one way or another.
Chapter 7 bankruptcy would mean liquidation of everything for pennies on the dollar. It will not happen.
GM has problems that no amount of bailout can fix. Chapter 11 prestructured bankruptcy would allow GM to operate. This scenario WILL happen. No congressional appointee is going to talk creditors and the UAW into taking one for the team, which is why there will be a bankruptcy. Bond payments could be slashed. If the bonds were called, it would be for pennies compared to par. We might be forced to exchange bonds for new stock. A court will decide which creditors will be paid, how much, and when. Members of both US parties are commenting on prearranged bankruptcy. The bright side is that we creditors would have first crack at the crumbs on the floor.
Here’s the crazy part: It probably will never be a declared bankruptcy, but a de facto one from a government “loan.” If the government gives GM loans, even outside of bankruptcy, it can mandate a change in the terms provided to bondholders. They can allow the restructuring that mirrors a Chapter 11 bankruptcy reorganization without declaring it.
[[Without Chapter 11-ish conditions, a bailout cannot work, so there would naturally be another bailout. The second one also cannot save GM, and Americans will get mad at Congress. Congress would discontinue the bailouts and then GM could go into real bankruptcy.]]
Some bondholders might sue: My The Financial Times RSS says large GM bond holders like PIMCO are fighting parts of GM’s recovery plan. “… Bond holders have nothing to gain from swapping for equity in an unsustainable capital structure, he said.”
I am extremely jittery about playing with nitroglycerin/GM bonds in a rough market. But don't dump your shares. The gov-mint will print yet more cash before asking for austerity measures.
Sirius XM's Guidance News is Substantial
Me, too -- I gasp for air every time I see the stock price.
Re: Big Marv and "correctional institution."
It is good to have long-term perpective on investments. 10 years after trusty work credits is a good time horizon.
Mr. Savery: Just joking. Don't shank me.
[Unless they go bk; then it would be a mercy.]
Trading Obama: Solar Stocks, GM Debt, Ambac Calls, Lorillard and Goldman Puts
...Or Congress could forgive the loans and issue more debt, as they do.
Greg Weston is a prescient genius.
If anybody looks at this article again, are there any calculations on the impact to GM cash flow from this:
seekingalpha.com/artic...
Trading Obama: Solar Stocks, GM Debt, Ambac Calls, Lorillard and Goldman Puts
..."the White House signaled an "orderly bankruptcy" remains under consideration."..... "There's an orderly way to do bankruptcies that provides for more of a soft landing -- I think that's what we would be talking about."...White House spokeswoman Dana Perino.
A prestructured bankruptcy was the best solution, but I was certain they'd bail out on the third-fourth try. I have worked in government long enough to know that the officials will always throw the money away - I mean, make budget allocations.
Blogs, Profanity and Editorial Integrity
Additionally, this is SA's site: Their house, their rules. They have the right to demand restraint and the right to edit whatever they want. Contributors have their own websites linked at the top. Therefore, if he pinnacle of your expository ability is "fuckingfuckingfu... then put it on your own site. Then, I can be impressed with your erudite assesments to the fullest extent.
Sirius XM Annual Meeting: What's on the Agenda?
It means that the stock price can decline farther. At 10 cents, there is a cushion below which buyers support it, since it cannot go much lower. At $1, it can drop 10X as much.
Current shareholders are hurt (worse), but managment has little choice to avoid delisting.
Ugh.
On Dec 18 09:56 AM Loy wrote:
> What exactly does the reverse split mean to someone that has shares
> in siri
If Cars Are the Problem, They Can Also Be the Solution
I guess it's not politician-directed corporate fascism if WE are the ones doing it?
Let's Hope the Auto Bailout Has Failed for Good
American cars: All posters who made comments on car quality are incorrect. For a decade, GM has been ahead in objectively measurable quailty. Now Ford is doing very well. Ford hybrids are better-executed than Toyota's, and GM has better technology than Honda. Welcome to the 21st century.
UAW wages: It does not matter if new hires are on par with competitiors. Detroit has hundreds of times as many who are not. It is not fair to cut existing salaries, but it is better than unemployment in the worst state in America. Additionally, the UAW forces automakers to pay employees whether or not a plant is even open! The UAW offered to reduce wages by $.01/hour. No wonder the Senate thought it was a waste to throw money at them. Detroit is not sustainable unless everything is overhauled. No money without guarantee of success is a good idea. Too bad the Senate didn't think about that before the Wall Street bailout.
Bosun.J: I feel sorry for you. I have been to a lot of countries, and the USA is not bad. If you are that filled with hatred for 300 million innocent working people, then you cannot be bailed out for any amount of money.
Big Two Bailout: Likelihood of Success Is Slim
I disagree with Gumby that people would not buy new GM shares after bankruptcy. Investors would be more confident in a solvent, sustainable business. A pre-structured bankruptcy is a long-term solution that could save the company.
Dear Speaker Pelosi,
Thanks for the 40% return on my insanely risky bonds!
Sincerely,
BGM holder
Evergreen Solar: Why This Overlooked Company Is a Good Investment
The huge order backlog may be deceiving, because that assumes there will be no cancellations, delays, capital problems with the buyers. Many industries are starting to get hit with cancelled orders.
EverQ is located in a country with massive subsidies, which may be reduced. They have had competitive advantages that ESLR itself will not receive. Subsidies in the USA will be currently renewed for political reasons, but states' and USA debt levels mean that something will get pummelled- either subsidies or the dollar itself.
Your Ideal Quarter Method makes predictions. But what happens if the ideal quarter does not occur, and then you multiply the reduced prediction by 4, and then another disappointing quarter occurs? Where is ESLR if customers delay $300M of orders? They still have to pay debt interest, factory, salaries, taxes, and benefits. The quick ratio is great, and I have no fear of solvency, but I would not loan them money.
I disagree with the consensus that massively increased capacity [fixed costs] is the answer. Let's assume that I am wrong. Who will loan them the money? "At September 27, the company owed about $449 million in long-tem contractual commitments and contingencies — more than eight times nine-months 2009 aggregate product sales."
industry.bnet.com/ener.../
String-ribbon is technology is not disruptive enough for me to assume that they will be the Apple of solar.
I did read the article - It was a good one. I apologize for not explaining my issues well enough.
Reconsidering Penny Stocks
I would actually add volume and fundamentals restrictions.
SIRI should be the only exception, as it is highly liquid.
Wall Street Breakfast: Must-Know News
Mr. Wilberforce,
Your perception is based on products from the 1970s. I had very bad luck with 70s GM & Fords [even worse]. Since 1983, however, GM reduced the quality gap every single year. By the 21 century, they PASSED Mercedes, Toyota and Honda in quantifiable problems. Only the JD Power first impressions survey has Lexus higher - And people, being suggestable, will never admit that they paid $50,000 for a poor-handling Camry [ES350.] But every long-term study places GM first in measurable quality. Polk has proven through registrations that all GM brands outlast the average.
This revelational news that GMs have not been junk for the past decade may be a blow to you. Therefore, I will not tell you the news about Ford's most recent model year statistics -- you might gasp so hard that you accidentally suck in the obituaries you were just reading.
I am sure that you did many bad things in the 1970s, too. But this is 2008.