Right now, for GM to avoid a bankruptcy filing, it has to get concessions or "sacrifice" from the "stakeholders". In plain terms this means the union and the bondholders. The union has already stepped up to the plate. It has sacrificed and offered additional sacrifice contingent on the bondholders. So far, though, the bondholders haven't … Continue reading Why GM will almost certainly go bankrupt.
GM has a problem. It's not the cars or the union. GM needs to get it's costs down as required by the govt loan terms. The union has agreed to it's share of the restructuring. Waggoner is now gone. What's left and what's blocking GM's turn-around are the the banks and bondholders. They refuse to … Continue reading Why GM could still go bankrupt: Banks & AIG are the problem
Now, with world leaders gathering this week in London to plot a response to the gravest global economic downturn since World War II, the fund is becoming a chip in a contest to reshape the postcrisis landscape. via Rising Powers Challenge U.S. on Role in I.M.F. - NYTimes.com.
Yesterday the Obama admin forced GM CEO Rick Waggoner to resign as a condition of continued support for GM's restructuring. Yet, the administration has not yet demanded any of the banks change management (except AIG & Fannie last Sept), despite the banks using 18-20 times as much bailout money. Several folks have asked me why? … Continue reading Why GM’s CEO is out, but no bank CEO is gone
Interesting article on economic crisis and changing corporate structures. For example, it describes how The Great Depression led to the creation of multi-divisional large corporations such as GE, GM, and DuPont (the corps already existed, the structure changed). Interesting to speculate how the current crisis will change corporate business organizations. via Unboxed - How Crisis … Continue reading Unboxed – How Crisis Shapes the Corporate Model – NYTimes.com
Ralph Nader has made IMHO an excellent contribution to the discussion of what can be done to prevent future crises on Wall St such as the current one. Here are seven avoidance indicators which outline what Washington is not doing to prevent another round of greed and misdeeds by the Wall Street few against the … Continue reading Nader: Seven Steps the Obama Admin is NOT Taking to Fix the Banking Crash, Why Not?
I will comment further at LCC Global Perspectives Conference, but All the idols of capitalism over the past three decades crashed. The assumptions and presumptions, paradigm and prognosis of indefinite progress under liberal free market capitalism have been tested and have failed. We are living the end of an entire epoch: Experts everywhere witness the … Continue reading Change in Econ Systems: The era of US-dominated Globalization ending
I will have more to say on Tuesday at the LCC Global Perspectives Conference, but it's not pretty. The planet's in trouble. Both the IMF and World Bank are now forecasting an outright fall in global output in 2009, with a larger contraction than previously forecast in the advanced economies and sharply lower expected growth … Continue reading worst global economic crisis since the 1930s
China believes the developing world should have a stronger say in how the international financial system is run via G20 must look beyond the needs of the top 20 | Wang Qishan - Times Online.
Anatole Kaletsky indicts the modern economist profession for the current crisis in the Prospect: Was Adam Smith an economist? Was Keynes, Ricardo or Schumpeter? By the standards of today’s academic economists, the answer is no. Smith, Ricardo and Keynes produced no mathematical models. Their work lacked the “analytical rigour” and precise deductive logic demanded by … Continue reading ‘Goodbye, homo economicus’: Apparently economics is thin-skinned