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GM's 'Time Is Very Short'

Wednesday, November 5, 2008, 3:04 PM

A friend of mine in the RV business, who has owned his own place for 35 years, says that his business has never dropped off as far or as fast as it has over the past 6 months. Manufacturers in his industry that have operated for more than 50 years are simply shutting down. 

Even as the nation focuses on an election and the "improving credit markets" the real economy is still spiraling downward at a fast rate.

The 45% "decline" in GM's sales are a stunning drop-off more consistent with the worst recession (depression?) in several generations than a simple "decline".

The collapse of GM is now an imminent possibility.

Nov. 5 (Bloomberg) -- General Motors Corp., hammered by the worst auto market in 25 years, needs U.S. aid because ``time is very short'' to stop its collapse, says Roger Altman, the former Treasury official advising GM in merger talks with Chrysler LLC.

With the government offering a $700 billion rescue for banks, it should have enough to assist GM, Chrysler and Ford Motor Co., Altman, 62, said in an interview. Altman, now chief executive officer of Evercore Partners Inc., helped with the 1979 Chrysler bailout plan as an assistant Treasury secretary.

``The consequences of a collapse by GM or all three would be very severe,'' he said. ``The impact would be widespread,'' with jobs lost by the companies and their suppliers.

The ripple effect of a GM collapse would spread throughout hundreds of small supplier companies and involve tens, if not hundreds of thousands of jobs.

Out in the real economy, the collapse of credit-fueled consumer spending is not going to be fixed by the high level application of government borrowing and gifting of money at the institutional level.

Sure we could give GM a lot of public money, but if not enough people are buying their products for them to survive we might ask "why?"

The problem is that 25 years of excess consumption has suddenly come to a halt and many companies, like GM, were not prepared.

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53 Comments

Doug's picture
Doug
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Re: GM's `Time Is Very Short'

Much of what underlies these giant bailouts is the notion that some businesses are too big to fail because of the resulting damage to the national economy.  This seems to me to be a structural weakness to our whole capitalist system.  Perhaps there should be an upper limit beyond which corporations are not allowed to grow.  This seems to me to have at least two salutary effects.

First, the economy wouldn't be threatened by the collapse of a single corporation.  Second, it would put the emphasis of capitalism back where it belongs, the small entrepreneur.  Inventors and innovators would still be able to reap huge profits from their creations, but would not be able to grow their companies, or to sell there companies to larger corporations that would then grow beyond limits that are healthy for the economy as a whole.  As we hear nauseatingly often, particularly during election seasons, small business is the real engine of growth to our economy.  I've always been skeptical of that assertion, but if it's true, then allowing corporations to grow into behemoths is counterproductive for an economy.

Am I way off base?

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Re: GM's `Time Is Very Short'

Doug:

My overall view is GM demise is an effect of the major drivers outlined by Chris.  Economic theory from MBA days...plus experiences suggest ideological preferences are tertiary.  Capitalism...seems to handle dynamic change better due to incentive...innovation to lowest level supplemented with healthy doses of accountability and transparency.

Some thoughts...

 

  

 

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Re: GM's `Time Is Very Short'
[quote=Doug]

Much of what underlies these giant bailouts is the notion that some businesses are too big to fail because of the resulting damage to the national economy.  This seems to me to be a structural weakness to our whole capitalist system.  Perhaps there should be an upper limit beyond which corporations are not allowed to grow.  This seems to me to have at least two salutary effects.

.....

[/quote]

 

Only problem I would see with that, an otherwise great idea.  Would be the necessary regulation to prevent corporations simply breeding multiple corporate entities of the same thing so inter-related and comanaged and mutually invested it might as well just be named the same.

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Re: GM's `Time Is Very Short'

SUPPLY AND DEMAND is the only financial law that you can not regulate or protect against in the long run. 

Any action by a government to stop this only increases the pain later unless a well thought out plan is in place to overcome the root concerns of the entity or market.  There are few of these sitations have ever happened.

This happened with Chrysler in the early 80's but they had a plan and a bit of luck with the minivan.

That said, even if GM is given money for a merger is it only to hold off the pain or is there a plan in place.  Just trying to get over a bad time thinking is gone.  

Like always the markets with Supply and Demand its one and only true law, will fix this problem if we let it.  Pain will happen, but in the end what should survive does and what should not does not.

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Re: GM's `Time Is Very Short'

SUPPLY AND DEMAND is the only financial law that you can not regulate or protect against in the long run. 

Any action by a government to stop this only increases the pain later unless a well thought out plan is in place to overcome the root concerns of the entity or market.  There are few of these sitations have ever happened.

This happened with Chrysler in the early 80's but they had a plan and a bit of luck with the minivan.

That said, even if GM is given money for a merger is it only to hold off the pain or is there a plan in place.  Just trying to get over a bad time thinking is gone.  

Like always the markets with Supply and Demand its one and only true law, will fix this problem if we let it.  Pain will happen, but in the end what should survive does and what should not does not.

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Re: GM's `Time Is Very Short'

Only problem I would see with that, an otherwise great idea.  Would be the necessary regulation to prevent corporations simply breeding multiple corporate entities of the same thing so inter-related and comanaged and mutually invested it might as well just be named the same.

[/quote]

Yes, traps everywhere, with regulation and even with free markets.  Basically, the way I see it, basic regulations (rules) are needed, similar antitrust/monopoly/consolidation laws, but of course there are plenty of issues that may arise.  If there are not set societal rules, then the wealthy/powerful will make those rules whether they are explicit or not.  For a democratic, supposedly egalitarian society, one of the most problematic mechanism is accumulation of wealth through generations.  There needs to be a balance that allows people to start children off well, but does not create power disparities.  Maybe a huge death tax over a certain amount (bracing for blunt force trauma).  This would be a use it or lose it tax...meaning that people can set up charitable trusts, invest in businesses/infrastructure, or more with wealth, but if not before they die, then the people will invest in the commons that benefit everyone.  Yes, highly "socialist," but I like playing with these different hypothetical options that enable opportunity, limit the power of accumulated wealth, and preserve competition in markets.  I can already feel the bruises from the responses to this post! 

In the end, I always come back to a central questions. Should wealth be able to outlive the person or entity that created it?  Is this multigenerational wealth anitegalitarian, antidemocratic, and antinationalistic?  If the free market works so well, why have nationstates where society supposedly has some connection of identity, which can run counter to the notion of individualism in free market models.  People care and look out for each other and tend to want to enact mechanisms and structures that protect those they care about.  I don't want other Americans (or humans for that matter) to suffer just because they are born into a bad situation and have no problem with the structures of the people (I am not suggesting our current system is representative of the people) creating mechanisms to assist in ameliorating these social conditions and enabling opportunity.

I don't suggest this is anyway a comprehesive model or correct, so please don't get up in arms.  Just rambling for discussion sake.

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Re: Why save GM? Strategic reasons

[quote]Sure we could give GM a lot of public money, but if not enough people are buying their products for them to survive we might ask "why?"[/quote]

A good reason to save GM is because it represents one of the few remaining reservoirs of manufacturing capacity in the United States.  So, it has great military and strategic importance.

I do agree that the company itself, should not be saved, merely the manufacturing capacity preserved.

--

Steve

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Re: GM's `Time Is Very Short'

Here in Germany its the same. The "proud of our economy" our automobile indutry, is in trouble, and the government hurried ahead to offer help. Simply, nobody wants a new car, when gas prizes ever increase, and the industry failed to develop electric cars or smaller ones, that require less gas.

I think Doug is right, but nobody would have followed his arguments, in times of economic imperialism, and big corporations having huge political influence. With economic imperialism i mean the doublespeaking of politicians, who praise free trade, but favor mergers in the national industries to keep them "competetive" internationally.

Let them go bankrupt. I know its hard for the peoples who lose their jobs, but when many workers, technicians and engineers are free, it might give a boost to the "local energy producing" industry.

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Re: GM's `Time Is Very Short'

Dumbasses (GM) shouldn't have killed the electric car. Excellent watch by the way, "Who Killed The Electric Car". If they hadn't [killed it] then they wouldn't be here [swirling the toilet] today.

I agree. No company should get this big. 

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Re: Why save GM? Strategic reasons

 

I am sure that I many will see this differenty, but isn't this the perfect example of creative destruction in capitalism?  GM and Ford have a very inefficient business model.  Granted this is not entirely of their own making, but they are still culpable to some extent.  When a business doesn't protect itself from changing market conditions....ie having huge inventories of SUVs on the lot never looking at the possibility that gas prices may rise, or planning for what might happen if people were no longer able to get financing...it is doomed to failure.  Looking only at the Supply/Demand side is short sighted which is what our domestic automakers have been for years.  In any business today you have to be able to operate on small margins and be willing/able to change your product to fit the needs/wants of your customer.  If we look at Supply/Demand meaning that they manufacturers are not supplying what the market demands, then that company MUST NOT SURVIVE.  Capitalism is in some senses evolutionary economics...the strongest (or better said the ones that are able to adapt quickly to changing enviroment) will and deserve to survive.  If any company cannot do that, I, as a taxpayer, do not want to continue to keep them alive.  The best thing we can do is to let them go extinct. 

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Re: GM's `Time Is Very Short'

I think you all miss the point, except Chris of course.....  " The problem is that 25 years of excess consumption has suddenly come to a halt and many companies, like GM, were not prepared."

Remember the Club of Rome?

They predicted this would happen way back in 1972....  it was called LIMITS TO GROWTH!

 

Mike. 

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Re: GM's `Time Is Very Short'

Relating back to Crash Course (good direction Damnthematrix), all the exponential growth charts are classic environmental overshoot seen in any other animal populations.  What happens after overshoot?  Crash...in the "natural" wolrd this means population crash.  Human beings are blinded by their own collective intelligence, thinking that we are somehow removed from the "natural" world and those overarching rules.  In this sense, we chose to ignore our intellectual capabilities and adopted competitive societal models where social darwinism is enabled and encouraged.  Over time we have been able to expand production as to only have economic crashes/recessions/downturns so that population growth was not necessarily affected.  Question is...is this the point of not only economic crash, but also population crash that was predicted by the neo-malthusians in the 1960s or do we stumble through this once again to find other solutions as to allow population to continue to grow?  OR do we find the happy medium, learn our lesson by understanding growth is problematic in our limited world and ameliorate human suffering through the transition.  The underlying lesson, as we all know by now, is the current paradigm of "growth" is the problem.

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Limits to growth

"Over time we have been able to expand production as to only have economic crashes/recessions/downturns so that population growth was not necessarily affected.  Question is...is this the point of not only economic crash, but also population crash that was predicted by the neo-malthusians in the 1960s"

Can I point you to another thread I started yesterday...

 http://www.peakprosperity.com/comment/4189#comment-4189

Mike 

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Re: GM's 'Time Is Very Short'

Well I can see my husbands and mine livelyhood will be back up to speed. People will need to keep older cars going and most of these companies make cars to be thrown away after a certain point. We already keep old tractors running and older heavy equipment too. Might be our route to getting through the hard times ahead till come up witha a better fuel/energy sources to use.

I find it interesting that my old suburban gets better gas mileage than many of the new trucks, overhauled engine and transmission and the body also holds up to the wear and tear.

This is what I would like to see, is less of the constant new new new, but new then use till all used up. Cars, planes, equipment, and even clothing and furniture too.

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Damnthematrix
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Re: GM's 'Time Is Very Short'
[quote=agapilot]

Well I can see my husbands and mine livelyhood will be back up to speed. People will need to keep older cars going and most of these companies make cars to be thrown away after a certain point.

[/quote]

AND just where do you think you'll get the fuel in 5 or 10 years' time?

Mexico won't be able to export by 2010.  Venezuela might decide it'd rather sell its oil to China.  Most of the deep sea drilling is not viable with oil under $150 - $200, and in any case, there are now serious doubts that money (debt!) to finance these multi-billion dollar projects may no longer be available..

I got rid of my car last year...

Mike. 

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Re: Why save GM? Strategic reasons

[quote] I am sure that I many will see this differenty, but isn't this the perfect example of creative destruction in capitalism?  GM and Ford have a very inefficient business model.  Granted this is not entirely of their own making, but they are still culpable to some extent. [/quote]

The problem csadvisor, is that you are looking at this issue through a very tiny lens.   Economics are only one of the things that a government needs to concern itself with.  Freedoms, rights, comfort,  justice, protection, etc... are also the providence of a government.   There isn't any one of these issues that can be diffinitively said to be more important than any others.   For instance (all other things being equal):

1) Would you rather live in a country with 4% real economic growth and no freedoms or a country with 2% economic growth and abundant freedoms?

2) Would you rather live in a country with 4% real economic growth and an average lifespan of 40 years or a country with 2% economic growth and an average lifespan of 80 years?

3) Would you rather live in a country with 4% real economic growth and be forced to work 60 hours a day of or a country with 2% economic growth and be forced to work 20 hours a day?

 

Likewise, even if GM and Ford are inefficient, there are reasons to keep them -- or at least their manufacturing abilities -- around.   For instance, if the United States found itself in a major war, GM's factories could be turned to the production of tanks and other weaponry.   From a military perspective keeping these failed companies afloat is a very cheap prospective.  Likewise, their very existence preserves US manufacturing might, and improves our ability to rebuild our country even if international trade fails (or our currency fails).

I do, however, have serious problems with rescuing the company called GM.   My preference would be to destroy GM confiscate its factories, and capitalize two to three new car companies to replace GM.   Then make sure that the government holds enough stock (to be sold during better times) so that it has a fair chance of reclaiming its investment plus a moderate profit.   Repeat as many times as necessary until a successful business finally takes root.

--

Steve 

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Re: Why save GM? Strategic reasons
[quote=srbarbour]

[quote] Would you rather live in a country with 4% real economic growth and be forced to work 60 hours a day of or a country with 2% economic growth and be forced to work 20 hours a day?

BOY you are some slave driver.....  and which planet do you come from that you can work 60 hours a DAY??? Tongue out

 

I do, however, have serious problems with rescuing the company called GM. My preference would be to destroy GM confiscate its factories, and capitalize two to three new car companies to replace GM. Then make sure that the government holds enough stock (to be sold during better times) so that it has a fair chance of reclaiming its investment plus a moderate profit. Repeat as many times as necessary until a successful business finally takes root.

--

Steve

[/quote]

[/quote]

Confiscate the factories and turn them into renewable energy manufacturing services.....  Forget cars.  They're dinosaurs now...

Mike. 

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Re: Why save GM? Strategic reasons
[quote]

Forget cars.  They're dinosaurs now...

 

[/quote]

 

If cars were dinosaurs, we'd have plenty of fossil fuels from their decaying scraps >_>

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As goes GM - so goes the economy

GM stock chart: Would you invest in this? 

GM

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Re: GM's 'Time Is Very Short'
[quote=agapilot]

Well I can see my husbands and mine livelyhood will be back up to speed. People will need to keep older cars going and most of these companies make cars to be thrown away after a certain point. We already keep old tractors running and older heavy equipment too. Might be our route to getting through the hard times ahead till come up witha a better fuel/energy sources to use.

[/quote]

Agapilot,

Good for you!  Sounds like there is good opportunity ahead for you so you will do quite well in the near term.  In turn this becomes a real benefit for your clients.  This is good example how how value can be created even when times are tough and provides an alternative to farming.  There will be many other skills needed like these in the local communities we are helping/intending to prepare since we don't just need food.  I've been also thinking about bio-diesel plants as an integrated part of a farming community (oil seeds are grown, some oil returns to the farmer and the excess is where the value is created for the community, and even the waste can be used for livestock).  Another idea is people that use their skills to provide energy efficiency in homes. 

Mike makes a good point that over the medium term we are going to have some significant issues from Peak Oil so you may want to consider how this could affect you.  Electric cars are part of the solution and while we can see the current and near term demand building it will take a lot of investment to get this industry rolling.  Fortunately since the large car manufacturers abandoned the scene a few years ago (See the movie "Who Killed The Electric Car" as mentioned by Davos) there are some prospects that have made several years of progress (Tesla and ZENN cars and Aptera are three examples).  This gives some hope in the long term but leaves a painful transition in the medium term.

Lessening our dependence on fossil fuels in a big way is part of the solution to the problems ahead. 

Well done Mike in having been able to give up your car.  Can you share with us what alternative transportation methods you are using?

All the best,

James

 

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Re: Why save GM? Strategic reasons

If cars were dinosaurs, we'd have plenty of fossil fuels from their decaying scraps >_>

LOL..!  You do realise that oil comes from marine animals and not dinosaurs...

Mike. 

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Re: GM's 'Time Is Very Short'
[quote=James705ca][quote=agapilot]

Mike makes a good point that over the medium term we are going to have some significant issues from Peak Oil so you may want to consider how this could affect you. Electric cars are part of the solution and while we can see the current and near term demand building it will take a lot of investment to get this industry rolling. Fortunately since the large car manufacturers abandoned the scene a few years ago (See the movie "Who Killed The Electric Car" as mentioned by Davos) there are some prospects that have made several years of progress (Tesla and ZENN cars and Aptera are three examples). This gives some hope in the long term but leaves a painful transition in the medium term.

Lessening our dependence on fossil fuels in a big way is part of the solution to the problems ahead.

Well done Mike in having been able to give up your car. Can you share with us what alternative transportation methods you are using?

All the best,

James

 

[/quote][/quote]

Sorry James, but electric car fleets will never happen.....  it's all to do with limits to growth, there are simply NOT the resources to make all the batteries needed to keep the billion cars running around on the planet right now.

Sure, you could build SOME, but only because with fossil fuels you can do anything.  Even build electric cars.  It takes 90 to 200 barrels of oil to build a car (depending on whether it's a Prius or a Hummer).  The roads are paved with oil too.

My solutions?  I stay home!  Oh and I own a carbon fiber road bike that I can do 40 miles on a stretch, even at my age (56)

Mike. 

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Re: GM's 'Time Is Very Short'

sbarbour

I do, however, have serious problems with rescuing the company called GM.   My preference would be to destroy GM confiscate its factories, and capitalize two to three new car companies to replace GM.

Confiscate factories and essentially give them to other companies? Oh what the hell. America has gone from a Constitutional Repubical to a Banana Republic anyway. I'm always struck by the vicarious desires of so many to rule the world at gunpoint. I picked one example, but it's so common.

As a side note, our would-be dictator fails to notice that the confiscated factories would still remain idle because demand for cars has dropped everywhere. The companies on the receiving end would be saddled with white elephants if they were stupid enough to accept the gift. Then we'd have a couple more bankrupt auto companies.

GM should be allowed to fail. Companies of any kind may wish to bid for the properties at auction if they think it is in their interest. That's how it's done in a Constitutional Republic.

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Re: GM's 'Time Is Very Short'

[quote] Confiscate factories and essentially give them to other companies? [/quote]

hewittr, what do you think bankruptcy does?

This is just a formation of a new company, operating on completely free market principles (the Government is an investor), using the resources of a company that failed.

[quote]Oh what the hell. America has gone from a Constitutional Repubical to a Banana Republic anyway. [/quote]

Our governmental system has nothing to do with free market dynamics.  It never has, and it never will.    This wouldn't even be the first time we've done something like this.

To be frank, hewittr, do you even know where companies came from?

[quote]As a side note, our would-be dictator fails to notice that the confiscated factories would still remain idle because demand for cars has dropped everywhere.[/quote]

There's lots of ways they could be put to use.  Cars need not be the only thing.  Besides, these resources would be idle anyway, hewittr.  Either that or hawked for a dime over sea, or scrapped to save (or recover) a few pennies.

[quote]The companies on the receiving end would be saddled with white elephants if they were stupid enough to accept the gift. [/quote]

Thats why you create new companies from thin air, hewittr.   Issue solved.

[quote]Then we'd have a couple more bankrupt auto companies.[/quote] 

At which point, you'd replace them again.  As many times as it takes.   The goal is merely to make sure the government keeps recovering its seed money in the long run, and maybe makes a moderate profit.   Once some enterprising individual starts making head way, the government retracts itself.

Hell, its easy enough to write the laws so that government has no choice but to retract itself -- and still get its money back.  That way not even you need fear persistent socialism.

[quote] GM should be allowed to fail. [/quote]

Agreed.  I in essence said that already.   I merely declared that there are strong and strategic reasons to  preserve the manufacturing capability.   Waste not, want not.

[quote]Companies of any kind may wish to bid for the properties at auction if they think it is in their interest. [/quote] 

And with what money shall they bid, hewittr?   Even in good times most of this stuff would end up obliterated or sold for dimes over sea.  How do you think the US lost all its manufacturing capacity?

[quote]That's how it's done in a Constitutional Republic.[/quote]

Someday hewittr, you'll realize that being a Constitutional Republic has absolutely nothing to do with the underlying economic system. 

--

Steve 

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Re: GM's 'Time Is Very Short'
[quote=Damnthematrix

All the best,

James ]

Sorry James, but electric car fleets will never happen.....  it's all to do with limits to growth, there are simply NOT the resources to make all the batteries needed to keep the billion cars running around on the planet right now.

Sure, you could build SOME, but only because with fossil fuels you can do anything.  Even build electric cars.  It takes 90 to 200 barrels of oil to build a car (depending on whether it's a Prius or a Hummer).  The roads are paved with oil too.

[/quote]

Thanks Mike,

The book Natural Capitalism didn't pick up on this fact - perhaps because they weren't conscious of peak oil at the time when the book was written (2000).  However they did pick up that "hypercars" as they called them weren't the solution anyways because no one can move around when there are another billion cars in front of your front bumper.  Their focus then turned to how to eliminate the hypercars - which involved rethinking mass transit ala Curitiba, Brazil - and which required a completely different political thought from a non-political but entirely capable person.

Peak oil doesn't mean the end of oil.  But it sure does mean an accelerated pace of change in a completely new direction.  I'm hopeful of that future direction.  Since I'm still an optimist I'm probably just not as well informed as you are!

By the way, I don't think that our current problems are because we've run into limits to growth yet.  I think we've run into a mathematical problem in the monetary system that is causing deflation of the money supply and the monetary system doesn't work well in reverse.  I suppose you could argue that this is a limit to growth but I'm not referring to a physical limit to growth.  I believe that we have a structural problem in the economy (housing bubble) that isn't being fixed to any great extent and that the relationship between income/assets vs. interest/debt is way out of wack (credit crisis)  [and I'm seriously downplaying the extent of the problem here].  

I do wish I had your five year head start!   

All the best,

James

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Re: GM's `Time Is Very Short'

I honestly don't think there's such a thing as too big to fail despite our government's protestations.

The whole auto industry is screwed and a lot of people are going to lose their jobs - that's the bottom line.  It matters little whether those losses come from 1 company or many.

Also, US cars apparently suck - the consumer has spoken - either that or GM doesn't know how to run it's business.  Show me the logic of propping up a company that either provides a product that is not sought after or is incompetent.

Actually it's not really that simple.  The root cause is that people were fooled into buying more cars than they could actually afford - thus GM was mislead into expanding inappropriately.  How?  Government "stimulation."  The same kind of crap that's being implemented right now to keep the game going.  The Fed lowered interest rates to absurd levels that it felt were "correct" and, next thing you know, banks are dying to lend to anyone with a pulse.  New financial lending entities are popping up right and left to do the same.

The root cause is the Fed. 

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Re: GM's 'Time Is Very Short'

as gm goes so goes the nation ............oh my god i am really getting concerned now.

obama and the democratic congress will spray as much money as they can to keep gm a zombie.

as  a multinational corporation having had it's fingers in the affairs of other countries to the detriment of the populace i just see it as karma. it is the only immutable law in the universe.

as for professor barbour's contention about keeping gm around for national security in case of war it is laughable on the face of it , on the backside of it and just about anyway you look at it.

first gm has no loyalty to the concept we euphemistically call the ol us of a.

second we can get the stuff we need from china cheaper and much faster. 

third is a little example of the creative, futuristic thinking of the lack of braintrust at ol gm.

in the 80's gm developed rare earth magnets. a very significant breakthrough. they are usd in all kinds of nifty things like missile guidance systems, computers etc.. gm  wanted in on the  ground floor in china to sell it's vehicles there. so a little quid pro quo. deng xioa peng's daughter was dispatched to acquire the technology. gm gave away the technology which is fairly crucial to our national defense for a new market.

80% of the rare earth for the magnets comes from china.

oh maybe some one thinks we might go to war with china. forget it. they already own us and they really would not want to damage any of their assets. they are a lot smarter than we are. they just bought us with our own money.

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Re: As goes GM - so goes the economy

Yea I will, when they are at like 2-3 cents. Thats a dead cat 3-4 bagger for sure.

 

 

 

 

 

 

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I say, let GM and Ford BURN

I say, let GM and Ford BURN-

 

Nothing but a bunch of greedy capitalists running these companies, capitalizing on the greed of America, selling absurd cars that consume beyond imagination. Foreign auto manufacturers did what they always do. Smaller, more affordable and better economy cars. GM and FORD just followed Americans greed for bigger and better, and dropped the ball totally. You can watch the foreign car manufacturers. If they are in trouble, the trouble for GM and FORD is 100 times worse, mark my words.

 

 

 

 

 

 

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Re: GM's 'Time Is Very Short'
[quote=James705ca][quote=Damnthematrix

By the way, I don't think that our current problems are because we've run into limits to growth yet. I think we've run into a mathematical problem in the monetary system that is causing deflation of the money supply and the monetary system doesn't work well in reverse. I suppose you could argue that this is a limit to growth but I'm not referring to a physical limit to growth. I believe that we have a structural problem in the economy (housing bubble) that isn't being fixed to any great extent and that the relationship between income/assets vs. interest/debt is way out of wack (credit crisis) [and I'm seriously downplaying the extent of the problem here].

I do wish I had your five year head start!

All the best,

James

[/quote][/quote]

James,  James,  James......  it works like this:

Debt has grown exponentially to such an extreme that it is now measured in hundreds of trillions.  With me?  To pay this debt back we need more exponential growth to generate more wealth (debt, really...) to pay the old debt.....  the ultimate vicious circle.

Trouble is, you can't have exponential economic growth unless you have exponential growth in ever cheaper, ever denser energy sources.  Oil, and gas. 

Party's over.

Mike. 

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War with China- War with Walmart

A war with China will never happen as long as America is the largest consumer of Chinese goods. Do you know when I started getting concerned? Let's all hop in thewayback machine to the mid 80's, when we still made our TV sets here, and Japan really was starting to come on. Within 5 years no more TV's were made here. Why? We invent it, they manufacture it better. Well, maybe not better as in better product. Cheaper and faster would be a good description. Although Japan electronics quality is very good. But wait, another company is coming into view, glorious China!

Back to the present. Everybody is all up in the air about GM and Ford, and this has been going on for decades. In fact, GM and Ford should have gone away a long time ago.

Let's move thewayback machine forward about 15 years, shall we? Oh my! Boeing is gone! No cars are made here at all! No manufacturing whatsoever, except for small, useless components we need locally. China is making all our cars and Jets! China is making EVERYTHING!

What ware we making? Nothing now. We just service the world, kind of like a big Disneyworld for all the other countries. Oh, and we make entertainment, a valued commodity in 2024. In fact, we are all entertainers for the world. We need to service all those tourists who come to visit the shell of what we were. We need to flip the burgers and open the Caviar for our Chinese tourists. Make the beds up in the hotels for our India tourists. Clean the houses of our European guests. THAT is what we will be. A giant service nation for other countries, like a nation of uneducated, dumbed down court jesters dancing around for the rest of the worlds entertainment and the remaining American uber rich.

What is actually made in America? You tell me? Hallmark cards, some stereo equipment, Monster cables, toys, soap, household cleaning chemicals, beauty products. Think about this the next time you visit WalMart or Target.

Do I blame the American consumer? well no I don't because It's impossible not to buy cheaply made goods in your price range, considering they are all you can afford on a tight budget. The biggest part of the consumer base in America is the poor, and its all they can afford. Most American's are pushed into a box and have few choices.

Just wait until we see $4000 Chinese cars in America sold at the new car showrooms in Walmart and Target, and then watch in amazement as the Japanese and Korean manufacturers get squeezed hard and put out of business, ghosts just like GM and Ford. Memories of the past.

The only thing Chinese or foreign goods do is load up our landfills quicker, because the acceleration of these cheap disposable goods increases dramatically.

When I was a kid, a TV was forever. We had one for like 9 years. Now you buy a new one every 2 years if not less. Same way with computers, music players, stereos, cell phones and many other items. Most consumer items are going the way of use and dispose, kinda like a cheap hairdryer. Cars will be in this position as well, it's only a matter of time.

I will be a bit nervous getting on a Chinese made aircraft knowing they can't make milk right. Wow, a typical Boeing aircraft has well over 5 million parts. That's a lot of chances for failure. Ni Hao, you are now free to roam the cabin.

I hope the drinks are not too expensive, because I am going to get hammered into a semi coma on alcohol and Xanax in the airport before I get on the Chinese made jet for the first time.

 

 

 

 

 

 

 

 

 

 

 

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Re: GM's 'Time Is Very Short'

Srbarbour

what do you think bankruptcy does?

When a company goes out of business, it auctions its assets to the highest bidders and the procedes are returned to the owners. By this means, the assets will go where they are the most useful and the owners at least get a chance to cut their losses.

This is just a formation of a new company, operating on completely free market principles (the Government is an investor), using the resources of a company that failed.

Not so! Governments do not invest; investing is a voluntary action. Rather, governments consume what they confiscate at the expense of taxpayers. There is nothing free about robbing Peter to pay Paul or keeping the booty to spend as they see fit.

Our governmental system has nothing to do with free market dynamics.  It never has, and it never will.    This wouldn't even be the first time we've done something like this.

On the contrary. There is no free market anywhere in the world. Government interferes in the process in more was than I can count. Right off the top, government consumes more than what the private market can produce, which is why it is so hopelessly in debt.

To be frank, hewittr, do you even know where companies came from?

All companies come from the right to contract where investors pool their money into a single organization. Government is not a business. It operates with the same scruples as a crime syndicate.

At which point, you'd replace them again.  As many times as it takes.  

In the private market, losses are limited to employees and investors. Govrnments subsidize failing businessess from taxpayers. You are  mirroring the Soviet mentality. They built factories that made things nobody wanted.

And with what money shall they bid, hewittr?   Even in good times most of this stuff would end up obliterated or sold for dimes over sea.  How do you think the US lost all its manufacturing capacity?

The problem is not for lack of money. The problem is a matter of price. If there are no bidders, so be it. The US drove manufacturing out of this country through excessive regulation and by creating a market the placed consumption over production.

Someday hewittr, you'll realize that being a Constitutional Republic has absolutely nothing to do with the underlying economic system. 

Wrong again. A Constitutional Republic protects property rights and the right to contract. Without those two basic rights, no investor is going to be foolish to risk his personal wealth. That's where nationalization comes in. Which is why I say that under the Bush Regime, America crossed the Rubicon into a Banana Republic. If you think this economy is bad now, you ain't see  nothing yet. Every action government takes to restore the economy will have worse consequences. It happened  in the 30s and it's going to happen again because the wrong lessons were drawn from Roosevelt's and  Hoover's fiasco.

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Re: GM's 'Time Is Very Short'

Interesting conversation.  I especially enjoy the discussion about the economy vs. the government and the roles of both.  I don't mean for this to seem like I am picking on specifics, but only utilizing some statements to make a point.

"A Constitutional Republic protects property rights and the right to contract.  Without those two basic rights, no investor is going to be foolish to risk his personal wealth." - I am not making a statement against these rights, but there is no specific limit to what should or should not be included in this governmental system.  The constitutional limiting of government power over people is a defining trait, but again not restricted to specific safeguards.  You are indicating that the governmental system sets that laws/rules for society and therefore the economy.  The existence of government for defense and protection of property rights is setting rules and in this context, would it not be appropriate for limited governmental rules as to set the standard for "free markets."  Basic local barter markets will develop under any political system, however, it is the existence of the larger societal structure of governance that enables "free markets" to develop and exist.  If this is not so, then government can be abolished. 

Further, the constitution also establishes citizen/civil rights; this in itself effects free markets!  If the free market is so perfect, and all that is needed is protection of property rights and the right to contract, then why establish and protect the basic rights of individuals....oh yeah, because the market does not do this!

I mentioned that the constitutionally limited power of government over individuals is the main defining trait of this system of governance.  Wealth begets power, especially wealth accumulated over generations.  SO, the protection of personal property, and therefore personal wealth, will necessarily lead to polarized wealth disparities, which undermines the very bedrock of an egalitarian democracy.  THIS IS THE INHERENT CONTRADICTION, SOME WOULD SAY PROBLEM, OF COMBINING DEMOCRACY WITH CAPITALISM!

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Re: GM's 'Time Is Very Short'

AJ

Let me say this in the beginnig. There is no such thing as a perfect free market or any other kind of market in the real world. The concept of a free market is a deductive logical tool. It assumes that individuals are the best judge of their needs and wants, that if left alone to buy and sell voluntarily, the market will utilize limited resources to the maximum efficiency for all. When government interfers with those decisions, it thwarts the goals of individuals causing misallocation of resources. Those misallocations can't be seen until they build up to the point of breakdown.

Governments cannot create wealth, but they can nurture the production of wealth. The ideal government would stay out of market decisions and act to protect person, liberty and property, and arbitrate contract disputes. The mortal problem is that this country and every other country in the world are the worst violaters of life, liberty and property. No country can become wealthy when citizen steals from citizen, whether privately or through government.

The ultimate goal of a viable market is to serve consumers, not business. The paradox is that business is afraid of consumers and consumers are afraid of business. So we are faced with demand for government interference from both sides. Business fear of consumers is well deserved. Consumers have no loyalty, they are whimsical and hard to predict. Government protection makes consumers more predictable by limiting their choices. Consumer fear of business is not well founded. Unfortunately they are more afraid of business than government when it should be the other way around.

 I mentioned that the constitutionally limited power of government over individuals is the main defining trait of this system of governance.  Wealth begets power, especially wealth accumulated over generations.  SO, the protection of personal property, and therefore personal wealth, will necessarily lead to polarized wealth disparities, which undermines the very bedrock of an egalitarian democracy.  THIS IS THE INHERENT CONTRADICTION, SOME WOULD SAY PROBLEM, OF COMBINING DEMOCRACY WITH CAPITALISM!

There are two ways to become wealthy: either by honestly serving the wants of consumers or by stealing. There are two ways to steal: legally and illegally. The contradiction is that voters base their votes on what the candidate can steal for them. But they don't stop to realize that a government that steals for them, also steals from them. The wealthy may be smaller in numbers, but their wealth more than makes up for it. And that is why my friend, this government has never been more powerful, the wealthy are wealthier and the poor are poorer. Democray is a false ideal.

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Re: GM's 'Time Is Very Short'
start a salvage yard parts will be hard to come by
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Re: GM's 'Time Is Very Short'

the first poster brought up an interesting point.

 

these corps have become to large and what is a proper way to regulate such large behemoths in a free market economy?

 

i'm an absolute believer in a free market but there must be restrictions imposed because a true free market is financial darwinism meets macchiavalli.

 

problem with our free market model now is that the regulators are outnumbered and being outsmarted. to answer your question, it is my belief that a corp may be allowed to grow as infinite as they can possibly grow under a certain condition, a percentage of profits is reapportioned to pay for a seperate regulatory body that governs that institution. as a company grows so does the watchful eye on operations. the banks of late have been able to expand immensely without supervision and had the capital to pay off regulators, they outnumbered and outpowered regulators.

 

the one shortfall of my theory is the greed of regulators, a possible solution is to rotate regulators frequently, that way no one becomes cozy.

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Re: GM's 'Time Is Very Short'

i'm an absolute believer in a free market but there must be restrictions imposed because a true free market is financial darwinism meets macchiavalli.

Oh please! That's a contradiction in terms. Darwin rules no matter what you do; it's a fundamental law of nature.

the one shortfall of my theory is the greed of regulators, a possible solution is to rotate regulators frequently, that way no one becomes cozy.

It's fatal flaw because the regulators are part of the problem and beholden to the corporations they regulate. Heads of regulatory bodies are appointed, so the job is rotated. The only solution is to get over your unfounded fears of a free market and be on the side of separating commerce from state in the same church and state are separated. It's not a panacea, but it's an improvement. Think of how it would undercut government's power to screw up your life.

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Re: War with China- War with Walmart

OMG!  I want to add to this post, but I need time to stop laughing and settle down!

You are the true orator - Krogoth in 2012! (wear the outfit in your icon - the peeps will love it!)  I'd like to nominate myself for VP, I could use a job that pays well doing nothing.

Bob 

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Re: GM's 'Time Is Very Short'

The reality is that the government will never let American icons like GM and Ford fall into non-existence without intervention.  You could argue that other iconic corporations have fallen, the best examples of which are in the airline industry.  BUT, they are service industries, not manufacturing industries.  Anybody with a car can run a taxi service.  What's important to realize however is that we the taxpayers will fork over the new bailout to the car companies, afterwards they will fail anyway in one form or another.  This too is the fate of some in the banking industry.  Had the government let the issue go on its own, some would fall, only to be scooped up at bargain basement rates by the strongest and savviest.  But then, the banks wouldn't have had the opportunity to soak up a cool $700bn in bonus cash on the way to the end.  I believe this same fate awaits the auto industry.

Some here have said it would be wrong to blame the workers themselves.  I strongly disagree!  The American workforce is a greedy and entitlement-based group of babies.  Looking back to the rise in power of the labor unions showed us just how much greed and corruption existed in the industry, and rather than seek reform and strengthen the systems future, they became worse than the monster they had condemned.  

If government had been held accountable for the way it ran itself, and done its job way back when, we would not be having any of these conversations right now.

Bob 

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VP does nothing?

OK Bob,

 

Sorry but I need to disagree with you. Our outgoing, weak hearted, physcopath of a VP for the last 8 years has done everything from pushing a false war against IRAQ, refusing to disclose information to the public, having a lesbian daughter and being against gayness in America to shooting hunting buddies. That's sounds pretty damn exciting to me.

 

If you want to be my VP, you better be colorful and powerful, because to tell you the truth, it's seems to have become quite a more visible and strong position over the last 2 terms. Cheney is a grand puppet-master.

 

 

 

 

 

 

 

 

 

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Re: GM's 'Time Is Very Short'

Hewitt,

For the most part, on particulars, we agree.  I know what markets are, however, "free markets" are ideological viewpoints, which you indicate to some degree.  We tend to deviate on these philosophical/ideological frameworks.  Free market ideologies make very specific arguments and can be valuable as an abstracted model, but these are still based upon philosophical viewpoints of how humans SHOULD act and how governance SHOULD be structured.  Once reality deviates from these assumptions, then the model breaks down, therefore the abstracted SHOULD happen becomes a moot point in the real world.

"The ideal government would stay out of market decisions and act to protect person, liberty and property, and arbitrate contract disputes."

Why would this be necessary for government structures?  Why could market mechanisms deal with this?  Private protection firms, hired body guards, and private arbitrators.  Because it is recognized that this would create entrenched power structures without any real protections.  The basic notion that there needs to be some governance idicates the intrinsic flaws of free marketism.  SO, as a market proponent, I recognize there are inherent flaws of markets that affect societal sturctures and therefore support the need for basic rules to be set so that fellow citizens and human beings are not alienated and oppressed by the system itself.  These rules need to flexible and dynamic, constantly being evaluated and negotiated by an ACTIVE citizenry, which needs at least basic public civic education.  There are resources that should be owned by the citizens of a nation and therefore have equitable allocation, since they are mandatory for survival and for a well-functioning system.  What these resources (human and physical) are is the debatable issues.

"There are two ways to become wealthy: either by honestly serving the wants of consumers or by stealing. There are two ways to steal: legally and illegally. The contradiction is that voters base their votes on what the candidate can steal for them. But they don't stop to realize that a government that steals for them, also steals from them. The wealthy may be smaller in numbers, but their wealth more than makes up for it. And that is why my friend, this government has never been more powerful, the wealthy are wealthier and the poor are poorer. Democray is a false ideal."

This is paragraph is based upon a very specific ideological viewpoint of representative government and not sure what point you are trying to make except convolute the agrument for free marketism.  SO, since democracy is a false ideal in this framework, you admit that free marketism cannot coexist with democratic ideals? ...because it is the free market framework from which you are arguing.  In the end, you argue in absolutes as if the is no other plausible perspective aside from your idelogical framework.  This is the true fallacy.  The only route to wisdom is to be aware of and acknowledge your own ignorance.  I tend to ascribe to this theme of the philosophical views of Socrates.

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Re: GM's `Time Is Very Short'

I think that GM's gas guzzling products have put them too far out of touch with their own customers. Ego-buying sales campaigns have now come full-circle to bite them. Only now they come to the public trough for handouts for a poor business model. Why is it that we should pony up money for them? Why is Japan one of the only car makers to see a few years ahead, in which we have all seen rising fuel costs, and yet bigger and bigger gas hogs out of Michigan? I say no, let them fall. Let them fall for their own greed, and not paying attention to the very market they are supposed to be serving.

Can we please get a high-quality fuel-efficient simple car - that is reliable? No, we do not need a V-12 ton and half piece of crap truck, that is classified as a car, for your bottom-line! We, the consumer, need a nice efficient reliable car, that happens to seat four. Why is that so hard to do?

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Re: GM's 'Time Is Very Short'

AJ

You keep forcing your misconceptions on a way of thinking you do not understand.

Free market ideologies make very specific arguments and can be valuable as an abstracted model, but these are still based upon philosophical viewpoints of how humans SHOULD act and how governance SHOULD be structured. 

Every human on this planet acts according to their perceived self interests. It's a fundamental law of nature. The best anyone can do is estimate what people will do with different degrees of certainty; the more familiar we are with people, the more predictable they are. Anyone who goes on the presumption of how people should behave is asking for trouble.

This is why government is ill suited to the task of managing an economy. It is here where you find the ideologues who have no inhibitions about forcing people to behave the way they should behave. By the very fact that they have to use force is proof that they have no idea what they are doing. Markets are extremely complex, too complex to be managed by force with any competence.

Because it is recognized that this would create entrenched power structures without any real protections.  The basic notion that there needs to be some governance idicates the intrinsic flaws of free marketism. 

So who protects us from government? This market crash is a direct result of government intervention - countefeiting, embezzlement, check-kiting, pyramiding and more. Under the doctrine of Sovereign Immunity, they can't be held criminally negligent for their actions.

SO, as a market proponent, I recognize there are inherent flaws of markets that affect societal sturctures and therefore support the need for basic rules to be set so that fellow citizens and human beings are not alienated and oppressed by the system itself. 

A market is whatever people make it. There are prudent was to manage money and reckless ways to manage money. In Austrian Theory, one learns the time-tested ways of properly managing money. I don't think Chris has an Austrian background, yet his research is based on prudent accounting methods.

SO, since democracy is a false ideal in this framework, you admit that free marketism cannot coexist with democratic ideals? ...

It can, provided the voters don't vote for government freebies. It was that way early in the history of this country. I think it was Toqueville who likened democracy to mob rule. I think democracy is workable in small territories. What keeps small democracies in check is the practically of its residents moving.

In the end, you argue in absolutes as if the is no other plausible perspective aside from your idelogical framework.  This is the true fallacy. 

What absolutes? To hear you, it's impossible to know how markets work and how they fail. That's your problem, not mine. I'll be laughing all the way to the bank.

The only route to wisdom is to be aware of and acknowledge your own ignorance.  I tend to ascribe to this theme of the philosophical views of Socrates.

Socrates' inquistions for famous for proving to his subjects that they don't know what they think they know. I still get the sense that you haven't the foggiest idea how markets work. Our current system of government is massively corrupt, criminal, wasteful, vicious, incompetent and delusional, I shouldn't have to explain it. But here you are tying to justify it.

 

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Re: GM's 'Time Is Very Short'

No. 1 automaker posts huge loss - says it has made case to Washington for
rescue.


NEW YORK (CNNMoney.com) -- General Motors shook an already embattled
auto industry Friday as it reported a huge quarterly loss that was much
worse than expected and warned it is in danger of running out of cash
in the coming months.GM, the nation's largest automaker,
reported it lost $4.2 billion, or $7.35 a share, excluding special
items. That's up from the loss $1.6 billion or $2.86 a share it
reported a year earlier and was far worse than the forecast of analysts
surveyed by earnings tracker Thomson Reuters, which had forecast a loss
of $3.70 a share.

But the most shocking news came in its
statements about its cash position. GM said it had burned through $6.9
billion during the quarter and warned that it "will approach the
minimum amount necessary to operate its business" during the current
quarter. In addition, the company said that in the first half
of next year its "estimated liquidity will fall significantly short" of
what it needs to continue operating. It said the only thing that would
save it would be a significant improvement in economic and automotive
industry conditions, help from the federal government, better access to
capital markets or some combination of those options.The report
was by far the most grim assessment by a company that has insisted it
is not considering filing for bankruptcy court protection. While the
release did not mention the threat of bankruptcy, the outlook appeared
to raise the possibility of such a dramatic step.

Dave Cole,chairman of Michigan think-tank the Center for Automotive Research,
said the chances that GM would be forced to file for bankruptcy were
high unless Congress takes almost immediate action to bail out the
industry."This is not something that can go on and be dealt with
in the next year, it needs to be dealt with in the next few weeks,"
said Cole. "When your cash is gone, you're gone."


http://money.cnn.com/2008/11/07/news/companies/gm/?postversion=2008110712

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Re: GM's 'Time Is Very Short'

Are you purposely pretending to be narrow sighted when reading my posts? 

"I still get the sense that you haven't the foggiest idea how markets work. Our current system of government is massively corrupt, criminal, wasteful, vicious, incompetent and delusional, I shouldn't have to explain it. But here you are tying to justify it." 

It seems that you cannot believe how someone cannot see what is so obvious to yourself, so you feel the need to insist that I don't understand your knowledge, that I must be ignorant to your vast knowledge of everything.  You love to say that I don't have the "foggiest", but saying it does not make it true or further make your own statements more valid.  I never try and justify any current conditions, I am commenting on your statements which are explicitly ideological and you continue to argue a totally different point than what I am making.  As I have told you many times, we agree on many specifics outside of ideological frameworks, including the current political economic conditions.

"It is here where you find the ideologues who have no inhibitions about forcing people to behave the way they should behave. By the very fact that they have to use force is proof that they have no idea what they are doing. Markets are extremely complex, too complex to be managed by force with any competence."

I don't disagree with some of your overarching point here, but markets to complex to manage?  I assume that your statement includes non-force management judging by your stated ideological framework?  Lets compare a direct metaphor.  Markets are just human behavior, just like cultural society.  So could we just not say, "society is extremely complex, too complex to be managed by force with any competence."  In this example, why have any civil or criminal law?  Why have any absolutes [general agreements by society as to what is acceptable]?  Since markets are human behavior, they conform, adjust, and adapt to their given cultural, political and physical environment.  Markets can and will exist in any given situation since it is human beings and their behavior and interactions that ARE the market.  Stop trying to project your ideological viewpoint as being the universal "understanding" of markets.

[My exerpt] SO, since democracy is a false ideal in this framework, you admit that free marketism cannot coexist with democratic ideals? ...

[Your excerpt] "It can, provided the voters don't vote for government freebies. It was that way early in the history of this country. I think it was Toqueville who likened democracy to mob rule."

Sorry, your caveat just proved my point.  Democracy and capitalism are different types of systems and if they are to coexist, compromises must be made because of human behavior and the nature of the systems with clash.  By the way, how was it in early in the history of this country?  People have always voted for self-interest...if there was just one way it was, then we would not have different philosophical viewpoints represented by parties or even have the need for elections.  Why do you insist on blowing up your own arguments?

"Every human on this planet acts according to their perceived self interests. It's a fundamental law of nature."

Really?  Explain this to all the sociologists, psychiatrists, and social psychiatritsts (just the major disciplines dealing with these issues).  It is amazing how in one sentence you have elimiated the need for and made obsolete all the actual scientific research conducted in understanding human behavior.  This is my central point, that you argue from a specific ideological viewpoint that is NOT universal.  What you seem to breifly describe is Ayn Rand's psuedo-philosophical/psychological model of human behavior call Objectivism, which is, therefore, the basis for her free market ideology.  This framework has many specific and validated critiques that has prevented it as an accepted model of human behavior.  All frameworks for understanding, or models, that contain assumptions about human behavior, even if it assumes you cannot predict behavior, thereby allowing for various outcomes in the model itself. 

"So who protects us from government? This market crash is a direct result of government intervention - countefeiting, embezzlement, check-kiting, pyramiding and more. Under the doctrine of Sovereign Immunity, they can't be held criminally negligent for their actions."

We are [should be] protected by our constitution and our political ACTIVENESS!  If you don't like the representation, then get the F involved at the local level by infiltrating parties and being politically active.  Lack of civic involvement is the real curse that has contributed to the current condition; people have failed to understand that the government IS US as long as we choose to be active in its maintenance. 

I agree with the rest of the statement, however it is the current conditions use as a strawman to demostrate the need for "free marketism" that I have a problem with.  Just because the system is corrupted and rigged, does not preclude this from occurring in a "free market" society.  This is argument is a logical fallacy.

 

Ray Hewitt's picture
Ray Hewitt
Status: Gold Member (Offline)
Joined: Apr 5 2008
Posts: 458
Re: GM's 'Time Is Very Short'

Aj

You're boring me! I've got better things to do then read your screeds, much less respond to them.

ajparrillo's picture
ajparrillo
Status: Bronze Member (Offline)
Joined: Sep 7 2008
Posts: 72
Re: GM's 'Time Is Very Short'

Hewitt,

I assume you meant "screed" in the best possible connotation.  I thought I attempted to bridge divides while displaying some of your errors; maybe I missed that target here.  I have developed an ethical responsibility is not to let unfounded ideological statements on important topics like we have here to be taken as absolute fact.  I don't care if you don't understand this or cannot handle these straight forward challenges to your statements.  Have fun undertaking your other, better things.  I will leave you with a statement I failed to address in my earlier response.

"Business fear of consumers is well deserved. Consumers have no loyalty, they are whimsical and hard to predict. Government protection makes consumers more predictable by limiting their choices. Consumer fear of business is not well founded. Unfortunately they are more afraid of business than government when it should be the other way around."

There are some underlying interesting arguments, but "consumer fear of business is not well founded"?  Really?  This statement is idiotic.  What are coporate lawyers for?  What do settlements cover up?  Remember, we are talking about the real world where profit motive is king, and required by law for public corporations, not a world of ideal free marketism.  I know...."this is not a free market and government regulation is the cause of every ill in our system."  Absolute free market ideals that promote individualism for the maximization of profit is in its essence sociopathic and possibly phychopathic behavior patterns that commodify ALL resources and strives to externalize costs while not drawing attention.  This is an observable, deductive model that has plenty of holes, but can be very useful in understanding economic behavior.

Doug's picture
Doug
Status: Diamond Member (Offline)
Joined: Oct 1 2008
Posts: 3159
Re: GM's 'Time Is Very Short'
For those extolling the virtues of an absolute free market, I will point out the obvious.  Probably the freest market in the world today is the credit default swap market.  Absolutely unregulated and run by the masters of the universe.  The result?  The greatest financial collapse in the history of the world.  How's that working for us?
miko9's picture
miko9
Status: Member (Offline)
Joined: Sep 18 2008
Posts: 6
Can we import tanks?

 

  • If the BIG 3 go belly up and the supporting manufacturing capacity is also adversely affected or destroyed how will this country be able to produce the machinery and weapons of war when we need them?

 

 

 

  • Will we be able to produce the parts to build the machines that win the battles? 

 

 

Miko 

Bheithir's picture
Bheithir
Status: Member (Offline)
Joined: Nov 2 2008
Posts: 24
Re: Can we import tanks?
[quote=miko9]

 

  • If the BIG 3 go belly up and the supporting manufacturing capacity is also adversely affected or destroyed how will this country be able to produce the machinery and weapons of war when we need them?

 

 

 

  • Will we be able to produce the parts to build the machines that win the battles? 

 

 

Miko 

[/quote]

Miko,  Neither GM, Ford nor Chrysler make tanks. Other companies do. GM makes the Humvee and CUCV for the Army. (I don't know about the other services.) The Big 3 don't make much of anything for the military.

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