As I hope you noticed I haven't posted for over a couple weeks. (if you haven't noticed, spare my feelings and don't tell me). It was mostly a busy schedule and some health issues. But I'm back at the keyboard ranting away now. Actually I'm also back in another way. After way too many months … Continue reading I’m Back!
With the GM IPO having succeeded so well this past week, the critics and nay-sayers have had to change tunes. I don't know that I really see the government investment in GM's bankruptcy and restructuring as a "bailout". I see more as the kind of strategic government intervention that helps the economy that a good … Continue reading GM, Banks, Bailouts and Incentives
Earlier this week General Motors, the new post-bankruptcy GM, issued it's Initial Public Offering. Initial signs are very encouraging in several ways, which I'll describe. But first let's take a note. Only 20 months, less than two years, The conservatives and tea party types were howling for GM to go bankrupt and for the government … Continue reading The GM Tale
Business Week catches up to Econproph from last month. The barriers to getting a deal done with GM bondholders, and negotiating away enough of that debt to strike a deal and avoid a planned, government-assisted bankruptcy, remain very big, with five weeks to go before the deadline. ...And second, some of the bondholders own credit … Continue reading GM: Some Bondholders Want Bankruptcy – BusinessWeek
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
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
Sweden Says No to Saving Saab via Sweden Says No to Saving Saab - NYTimes.com. Despite it's reputation for being "socialist", Sweden decides that failed businesses, even when large employers, don't always need to be rescued -- at least not if it leaves it in private hands.
I'll admit I'm surprised. My inner cynic suspected the Bush administration would try a pre-packaged Ch. 11 bankruptcy for GM or Chrysler, or that they would dither and play Hamlet so long that the Chrysler, GM, or some big Tier 1 would end up in bankruptcy anyway for Christmas. Instead, GM/Chrysler get their bridge loans. … Continue reading Surprise: Bush sort of does the right thing for GM/Chrysler
The NFL should watch out. Armchair quarterbacking while watching football on TV is being challenged by a new couch potato activity: armchair management. It seems that nationwide people, pundits, Wall Street analysts, and even U.S. Senators have the solution for GM and the U.S.-headquartered auto industry: file chapter 11 bankruptcy and "re-structure". It worked for … Continue reading Industry Matters: Why Chap 11 Bankruptcy Won’t Help GM