It has only been a little over a month since GM’s- Rick Wagoner stood in front of the U.S. government and every American taxpayer begging for government emergency funds to bailout his company and convinced the fed to give him $13.4billion. He promised to stimulate the sale of GM’s stagnant inventory, save jobs and reorganize to be competitive in the way they do business. Since the first payment made last month for $4billion, Rick is now changing the tune of his story saying “the U.S. economy and global economies have faced an unprecedented series of challenges over the past year”. What Rick is telling us is that in his first forecast given to convince the fed for the bailout money, that he planned to sell 12 million autos in 2009 and now one month later he must lower the estimate to 10 million autos. Rick Wagoner made the announcement at an auto conference in Detroit last week and this will be in his updated report to give to the government next month.
My fellow Americans, we have been buffaloed- big time. GM continues to use the bailout money for interests other than focusing on clearing out existing inventory to allow plants to build more autos to save autoworkers jobs. Rick will be back in the money line by midwinter begging for more bailout cash hoping to receive more of the $350billion balance. And don’t be surprised if shortly after GM receives the last payment, Rick announces in the spring that GM must go into bankruptcy as his plan failed.
The stimulus funding for GM should stop immediately and GM should be mandated into bankruptcy now as to protect our money and try to secure jobs. Just as in any traditional bankruptcy procedure, the first thing GM should do is clear out and liquidate every auto GM has in its inventory at it dealers and stockyards to recoup the cash now. Take all GM auto products to its dealer’s lots and have a public auction with no reserve pricing. If GM is left on its own to decide how to fix the problem and continues the way they are there will be more jobs lost every day and inventory will not reduce and plants will close. The Fed has the power to call back the first portion of this bailout loan at the end of February and stop funding GM, do think they will?
Circuit City announced recently they will be closing their doors as negotiations for an acquisition fell thru. Every one of their stores will close and liquidation will start within days. Is the Fed bailing out Circuit City?? Of course not. What’s The Story
1 response so far ↓
Mark T. Market // January 25, 2009 at 10:02 am |
Since the crisis began to be apparent and the US government scrambled to come up with a bailout solution, more and more people like you have become vocal about the negative effects of the bailout.
I posted recently the ongoing debate between Peter Schiff and Steven Leeb who represent the two sides in the heated argument regarding bailouts and government intervention.