GM & Chrysler Bankruptcy

G.M., Leaking Cash, Faces Bigger Chance of Bankruptcy

Even after receiving $15.4 billion in federal loans, General Motors is once again on the brink of financial collapse.

The automaker’s first-quarter earnings released Thursday showed that G.M. was losing more money and sales than it was in late December, when the government began its bailout…………..

This is occurring as Chrysler is in Bankruptcy

Chrysler Files to Seek Bankruptcy Protection

President Obama forced Chrysler into federal bankruptcy protection on Thursday so it could pursue a lifesaving alliance with the Italian automaker Fiat, in yet another extraordinary intervention into private industry by the federal government.
Flanked by his automobile task force of cabinet secretaries and business advisers in the White House’s grand entranceway, Mr. Obama announced a plan that would allow the United Automobile Workers, through their retirement plan, to take control of Chrysler, with Fiat and the United States as junior partners. The government would lend about $8 billion more to the company, on top of the $4 billion it had already provided……

If this is the good things that comes out of companies being to big to fail and then being supported by a federal government which is to big to fail.

This just proves that the US federal government is to bg and needs to be dismantled and let the states try to run things since the feds have screwed things up so badly.

Saturday’s cartoons – politics

from townhall.com

A Federal Government Bank?

Obama team weighs government bank

The Fed has already dumped ~ $ 10 Trillion into the banking system on top of the $1 Trillion actually authorized by Congress which has lead to nothing but more debt and more people out of work.

The more the government helps, the worse the recession will get and the longer it will last.

A recession is like a wound or injury. Wounds happen, the cut has occurred, the bleeding cleans the wound and the band-aid covers it up.
Do you like the band-aid removed slow or fast.
Government involvement = slow, peel off the scab and re-open the wound.
Government inaction = fast, scab does not peel off and the wound continues to heal.

Free Markets – Another Midnight Bank of America Bailout

Bank of America to get $20 billion in emergency funds

Glad to see that Bush and Obama are agreed that the government needs to give money to one private bank to buy another private bank and when the purchase of the failing bank does not work out the government will give more money to the original private bank.

Socialism to save the free-markets. What a grand concept.

Michelle Malkin has a great history and commentary on this topic.

Middle of the night bailout for Bank of America; TARP investigation of BoA and Citigroup/Jesse Jackson event requested

Fred Thompson on the Economy

A great link found on Frank Lynch’s Blog

http://blip.tv/file/1528079

It is a shame that Fred was not this charismatic on the campaign trail.

TARP = Socialism

Government to Pick Winners and Losers

I would like someone to point to the area of the constitution which allows the US government to pick which businesses succeed and fail in the American Economy.

Treasury Opens Door to Aid for Broad Array of Firms, Industries

‘Constructively Ambiguous’

Treasury officials “much prefer discretion, and so they would view the statement as being constructively ambiguous,” Reinhart said. “It’s appropriate that they end the year the way they spent most of it — that is, adding uncertainty into an environment in which there’s a lot of uncertainty.”

The guidelines don’t bind the government, so the lack of specifics gives President-elect Barack Obama plenty of leeway to decide who succeeds and fails when he takes office in three weeks. The bailout was originally designed to buy assets from banks and has instead become a fund for Treasury to prop up lenders, insurers, carmakers, auto-finance companies and, now, any firm that may be important to those industries.

Slippery Slope

“The further you go, the slipperier the slope becomes, the more you open the door to anyone who says, ‘Look, my firm is in trouble, I need help too,’” said Lyle Gramley, a former Fed governor and now a Washington-based senior economic adviser for Stanford Group Co. “We don’t want to go any further down that road than we absolutely have to.”

In America we do not elect gods or omnipotent beings. These appointed bureaucrats of the elected officials are a joke. I love how things things are always announced on a Sunday night or a holiday night when the media and most people are not paying attention.

Where is the openness and direct communication, where is the honesty. The founders who fought against a strong central government were 100% correct, centralized power will destroy freedom and liberty.

America has now voted itself into socialism just like Venezuela, I hope the power outages, oil refinery problems, food shortages and coffee shortages.

This is the result of government officials picking and choosing winners and losers in business.

We all need to take a page from Ronald Reagan.
From his 1st Inaugural address

……..
You and I, as individuals, can, by borrowing, live beyond our means, but for only a limited period of time. Why, then, should we think that collectively, as a nation, we’re not bound by that same limitation?
………..
In this present crisis, government is not the solution to our problem; government is the problem. From time to time we’ve been tempted to believe that society has become too complex to be managed by self-rule, that government by an elite group is superior to government for, by, and of the people. Well, if no one among us is capable of governing himself, then who among us has the capacity to govern someone else? All of us together, in and out of government, must bear the burden. The solutions we seek must be equitable, with no one group singled out to pay a higher price.
…….

Another great Reagan Quote

The nine most terrifying words in the English language are, ‘I’m from the government and I’m here to help.’
Ronald Reagan

saving, paying your bills on time, fed says you are a fool

Fed Cuts Rates, Punishing Thrift, and Impoverishing Savers

The Fed’s rate cut will also have the effect of reducing already very low interest rates on savings accounts, costing savers money. Not only is your bank interest rate less than the inflation rate, eroding the value of your savings, but to add insult to injury, you have to pay income tax on the insultingly-low interest, too.

The Fed’s action misdiagnoses the cause of the financial crisis. Banks aren’t refusing to lend money because interest rates are too high — they’re refusing to lend because they are afraid they won’t be paid back. The Fed’s irresponsible actions lend weight to such fears.

The Fed’s action, which is partly intended to prop up overextended borrowers by reducing their interest payments, sends the message that the government will protect such borrowers from the consequences of their own overspending and recklessness, regardless of the cost to others.

For those of us who live within our means and try to be honest are being destroyed by our socialist government.

Fed slashes key rate to near zero

But the Fed said in a statement that it is looking at different steps it can take to stimulate the economy and keep market rates low, including the purchases of long-term U.S. Treasury notes. The Fed also said it will consider other, yet to be disclosed moves as well.

Someone needs to explain this to me, I must be to stupid to understand.

Is this really what Bernanke (the Fed) is saying, if needed in the future we are going to simulate the economy by having the fed (which prints money backed by U.S. taxpayers) by buying U.S. treasury notes which are backed by the U.S. taxpayer.

Am I the only one who thinks this is would be a bigger Ponzi scheme than Madoff pulled off with his hedge fund.

more Bailout Fallout – America is in deep trouble

Bush defends government rescue of Citigroup

Let’s see what the bailout has gotten America.

The financial commitments of the taxpayers:
Current lawful debt ceiling is $10 trillion (not counting money “borrowed” from social security), outside of the lawful debt the FED has committed to backing up to $7.4 trillion in additional securities.

The US GDP in 2007 was ~ $11.5 Trillion dollars.

Think about this, the US has committed to repay of 150% of one years GDP and these are our financial leaders who know how to make things better. No sane person would be allowed to carry 150% of a years salary as debt. Well I guess that is what got the banks into this mess, thinking there was sane people in control and not loading money to people which has no chance of being paid back.

So the great plan of Bernake, Paulson, Bush to be continued by the Obama administration as he states in his press conference.

President-elect Barack Obama pledged Monday to honor the commitments the outgoing Bush administration has made to rescue financial markets and urged the new, incoming Congress to pass a major stimulus package “right away” to restore growth and create jobs. ….
….
President-elect Barack Obama tapped New York Federal Reserve President Tim Geithner as his treasury secretary on Monday
….

Tim Geithner is part of the FED which has committed the US taxpayer to bail out everyone under the sun that needs money due to their bad business practices and stupidity.

The Obama solution to the US financial problems

He declined to say how big a spending package he wants to revive the economy, but he said, “It’s going to be costly.” Some Democratic lawmakers are speculating about a two-year measure as large as $700 billion.

Just another 3/4 trillion dollars. I guess when you are so far in debt that there is no hope to ever pay off your bills, keep borrowing (printing money that will turn out to be worthless) as long as people are stupid enough to loan it to you.

Currently
17.4 trillion dollars in commitments, 300 million people = $58000 per person.
Average US salary in 2008 = $44900
Every US person that is alive owes more money that they earn by 30% of a years salary.

If Obama and the democrats have a $700 billion stimulus, the per person average goes to $60333. I am sure everyone salary will go up enough to cover this increase.

One of the best lines I have read to date is from (Bloomberg news)

Requiring the Fed to disclose loan recipients might set off panic, said David Tobin, principal of New York-based loan-sale consultants and investment bank Mission Capital Advisors LLC.
‘Mark to Market’
“If you mark to market today, the banking system is bankrupt,” Tobin said. “So what do you do? You try to keep it going as best you can.”

Translation, the America People are to stupid to be told the truth since we (government and bankers that caused the problem) know better than them what to do with their money.

The American people will be paying for this stupid spending spree for a long time or the country will go so far down that there will be no America left.

Someone in government stop the insanity,one can’t spend or borrow your way out of debt.

Continuing the Bailout – Bad for America

1) American Express wants a bailout to write off delinquent credit card debt. (I have an idea do not give credit cards to people who can’t pay the bill.) The Government should tell AMEX, NO. Please someone stop the insanity. Does this mean the people who have not paid their bill do not have to? Where is the responsibility, why do the taxpayers have to cover a businesses losses for loaning people money who will not pay the loan back.

2) Barney Franks want to give the auto companies $25 Billion but only is the government can take ownership of preferred stock. I guess I was wrong, I thought the democrats would be more subtle than just basically saying, OK we will buy your failing business and run it ourselves. Can anyone stop the government from taking over the auto companies? I hope someone rescues America from itself.

3) http://blogs.abcnews.com/theworldnewser/2008/11/want-some-gover.html
Hank Paulson now admits the bank bailout (TARP) has not worked and he is changing tactics. He says he knew before the law was passed and signed that everything he told congress was no longer true and that the bank bailout would not work but he took 4 to 5 weeks and about 1/2 the money gone to make this public, nice. Since this man knowing did not correct the now false statements he made to congress before they voted to hand him a check for $700 Billion dollars with no rules or oversight can he be prosecuted for misleading congress and the American people. I guess this is more of the ends justifying the means.

4) http://www.bloomberg.com/apps/news?pid=20601087&sid=axpH4Qil0NT8&refer=worldwide
The Fed has given $2 Trillion dollars of American taxpayer money to who knows for no know real assets. This is on top of the $700 Billion congressional approved bailout. What do you expect when you give 2 men the ability to write check with no oversight due to needing to do things fast.
Bernanke and Paulson make the most dishonest used car salesman and ambulance chasing lawyers look like honorable and honest citizens.

FEDERAL GOVERNMENT PLEASE STOP LYING TO YOUR EMPLOYER (ME THE VOTER).

I do not care if Paulson will be gone after Jan 20th, he should be asked to resign now and Bush and congress should demand Bernanke resign. They have both knowingly lied to the American people and should no longer be trusted with our money.