Comments on: Bailout II

By: Jordon

Jordon — Wed, 12 Nov 2008 01:49:02 +0000

Mike, I agree, if I was Toyota I am not sure if I would want them. Maybe bankruptcy is the way to go.

By: Jordon

Jordon — Wed, 12 Nov 2008 01:48:16 +0000

Bob, I lived in Alberta during the 80s. At one time every house on my street was for sale or forclosed. Those were oil field workers who were not calling the shots either. They went to church, had kids that went to school with me, and were good people but that is a result of living in a free market economy.

By: …..links for your linking pleasure 2…….. « Community of the Risen

Wed, 12 Nov 2008 01:42:28 +0000

[...] but am still angry that he is considering a bailout for automakers (Jordon Cooper seems to share my anger…while you’re there also look at what Starbucks would look like if it were a [...]

By: Mike O

Mike O — Tue, 11 Nov 2008 16:39:35 +0000

Wells Fargo got Wachovia for “free” – they got more in tax loss carryforwards than they paid. Under US tax code, a company can reduce it’s tax bill by using losses in prior years. Either their own, or those from a company it bought. Of course, you have to make money to use this benefit. Wells made far more money than Citi, so they were willing to pay more, because it was worth more to them.

GM has 38 billion in losses, but Toyota has no profits right now, so it doesn’t do them any good. And, even if it was free, buying a brain-dead company is risky from a corporate culture standpoint. When Compaq bought DEC, it got all of DEC’s “professional survivors”. DEC, in it’s heyday, had 200,000 employees/contractors but by the time Compaq bought it, there were only 50,000. Most of Compaq’s downfall (and sale to HP) came from toxic survivors of DEC, poisoning Compaq. But, on paper, each DEC share ($25) had $7 in cash, $7 in real estate (all you church planters know why!) and $7 in tax loss carryforwards. Any Japanese company is so culture-savvy, they would love the assets, but know there is no way they could take over a company and fire 20,000 Michigan workers.

As far as using bailout money for buyouts, I think that was written in the deal, but implementing it is another story.

By: Bob Cornwall

Bob Cornwall — Tue, 11 Nov 2008 14:45:17 +0000

Bailing out the auto companies might seem to many a less than savory thing, but consider what would happen if they went under. As one who recently moved to Michigan, I know what would happen. Michigan would come crashing down. It’s not just the auto companies themselves, its the suppliers, and more. A collapse of the automakers would put hundreds of thousands of workers out of work — members of my congregation.

Yes, the auto companies made some bad choices, but they did so in large part because we the people demanded gas guzzlers, vehicles that made money.

Will we buy small cars? Will we buy vehicles made in America? We have two Fords, both are good cars. It’s time we start looking here.