This sounds like a pretty good deal for the taxpayers and would save us having to loan the company even more money if it goes Chapter 11.
The ad hoc committee of GM bondholders said their plan would see them get 58% of the new company in return for debt forgiveness while saving U.S. taxpayers $10 billion in cash. The union health-care fund, based on the $20 billion in benefits owed, would own 41%.
So we have the union health-care fund as a stake holder and the bond holders in control of the company. That means the government does not have to nationalize yet another company and be forced to cover their warranties and other undesirable things. My money is on the Obama team rejecting this offer and low-balling the bondholders. If that is the case the bondholders should force the issue by declaring that they will force the company into Chapter 7 and receiving their money through liquidation.
Thursday, April 30, 2009
Chrysler Files for Chapter 11: Non TARP lenders say no deal
I think these Non-TARP lenders did not want to be ripped off by the government so they forced Chrysler into Chapter 11.
In any case, the company is irreparably damaged and is now owned by like 5 different parties including the UAW. If I was Fiat I would walk away from the deal because you might end up with Darth Vader as a business partner. Whenever I think of any company involved with government money or ownership I hear this line from Empire: "I have altered the deal, pray I don't alter it any further."
On Thursday, a group of funds identifying themselves as 20 of Chrysler's "non-TARP lenders" released a statement saying they had been sidelined during negotiations between lenders and the government. The group, which said it holds $1 billion in Chrysler debt, complained that the four banks were "obviously conflicted" because they had accepted money from the government's Troubled Asset Relief Program while they had not gotten TARP money.
The group said its offer to the Treasury Department to reduce its claim to 40 percent was "flatly rejected or ignored."
Yup they did not want to go with that low-ball offer $2.25 billion in cash on their $6.9 billion in secured debt. I mean these guys have the legal rights to get back most of their money if the company goes into Chapter 11 so why shouldn't they take this deal? I mean they have shareholders who they have a fiduciary responsibility to. They should not have to take a low-ball offer and lose millions in principal.In any case, the company is irreparably damaged and is now owned by like 5 different parties including the UAW. If I was Fiat I would walk away from the deal because you might end up with Darth Vader as a business partner. Whenever I think of any company involved with government money or ownership I hear this line from Empire: "I have altered the deal, pray I don't alter it any further."
Wednesday, April 29, 2009
Congress Passes Obama's Budget: Cap and Trade Thankfully Omitted
I guess the "down payment" for universal healthcare is now in the works. Wait until Americans have to wait months or years for needed surgery. Then Obama can blame doctors or insurance companies or some other scapegoat when that happens.
Wednesday's House and Senate votes to adopt the nonbinding budget blueprint were only a first step toward Obama's goal of providing health care coverage for all Americans. The budget plan for the fiscal year that begins Oct. 1 sets the parameters for subsequent tax and spending bills expected to boost clean energy programs and student aid and extend many of former President George W. Bush's tax cuts.
It seems the tax cut for 95% of Americans was left on the cutting room floor though. I hope no one got used to spending that $13 per paycheck worth of change that Obama threw our way.
As a result, Democrats opted against extending Obama's signature $400 tax cut for most workers beyond next year and cut $10 billion from his budget for non-defense programs. Also gone are revenues from Obama's "cap-and-trade" plan for curbing global warming by auctioning permits to emit greenhouse gases.
That last bit was enormously important because it would have levied a tax on 100% of Americans whenever they flipped a light switch or filled up their car with gas. I hope someone in the Democratic party understands that taxing energy companies just makes them pass "carbon taxes" right on to Americans in the form of higher prices.
I think this energy bill that is supposed to be passed this summer will be vitally important to any recovery effort. Raising taxes during a recession (even using indirect methods) is a recipe for a multi-year Depression. Maybe Obama will channel Carter and tell us to put on a sweater and turn down our thermostats to save money.
Wednesday's House and Senate votes to adopt the nonbinding budget blueprint were only a first step toward Obama's goal of providing health care coverage for all Americans. The budget plan for the fiscal year that begins Oct. 1 sets the parameters for subsequent tax and spending bills expected to boost clean energy programs and student aid and extend many of former President George W. Bush's tax cuts.
It seems the tax cut for 95% of Americans was left on the cutting room floor though. I hope no one got used to spending that $13 per paycheck worth of change that Obama threw our way.
As a result, Democrats opted against extending Obama's signature $400 tax cut for most workers beyond next year and cut $10 billion from his budget for non-defense programs. Also gone are revenues from Obama's "cap-and-trade" plan for curbing global warming by auctioning permits to emit greenhouse gases.
That last bit was enormously important because it would have levied a tax on 100% of Americans whenever they flipped a light switch or filled up their car with gas. I hope someone in the Democratic party understands that taxing energy companies just makes them pass "carbon taxes" right on to Americans in the form of higher prices.
I think this energy bill that is supposed to be passed this summer will be vitally important to any recovery effort. Raising taxes during a recession (even using indirect methods) is a recipe for a multi-year Depression. Maybe Obama will channel Carter and tell us to put on a sweater and turn down our thermostats to save money.
Banks Trying to Avoid all Government "Help"
It seems that the strings attached to government money are just too much for many banks to take.
Regulators, engaged in aggressive ad-hockery for the better part of 2 years, have lost credibility. Congress, engaged in egregious political grandstanding, has lost what little trust it had to begin with. Banks, engaged in a fight to remain solvent as well as independent, want to avoid both.
The more Washington insists on influencing the day-to-day operations of the firms it props up, the less inclined banks will be to accept help. Those that can afford to go it alone will do so - even if it means shrinking their operations. This, in turn, could prolong the recession - even as government efforts strive to do the opposite.
I mean some banks are trying to raise capital by almost any means in order to throw off the government reigns on them. They don't want to lose all their best people to Europe or the Middle East because Congress and the AG of New York threatens their lives over their bonuses. Also the idea that the White House can fire you on a whim has some CEOs rethinking "recapitalization" as well.
Regulators, engaged in aggressive ad-hockery for the better part of 2 years, have lost credibility. Congress, engaged in egregious political grandstanding, has lost what little trust it had to begin with. Banks, engaged in a fight to remain solvent as well as independent, want to avoid both.
The more Washington insists on influencing the day-to-day operations of the firms it props up, the less inclined banks will be to accept help. Those that can afford to go it alone will do so - even if it means shrinking their operations. This, in turn, could prolong the recession - even as government efforts strive to do the opposite.
I mean some banks are trying to raise capital by almost any means in order to throw off the government reigns on them. They don't want to lose all their best people to Europe or the Middle East because Congress and the AG of New York threatens their lives over their bonuses. Also the idea that the White House can fire you on a whim has some CEOs rethinking "recapitalization" as well.
Obama Extends America's hand to Cuba: The Castros slap it away
I think Obama needs to understand that some of these nations will not change unless their "dear leaders" die. Cuba is a case in point.
The Cuban president suggested the communist government is not willing to appease Washington by embracing small political and social reforms on the island, saying in a speech before an international gathering of government ministers that "it is not Cuba who has to make gestures."
The Castros are in their 80s so it will just be a few more years until they are dead. After that Cuba will probably be a free and democratic society. I call this the "one-man roadblock to peace" principal. You had this with Stalin, Yasser Arafat, and Kim Jong Il. You might have had this with Saddam too if we didn't remove him from power.
These roadblocks are usually old men with shaky heirs that they probably can't entrust their country to. They want to hold on to power and not be marginalized after terrorizing their country for decades. They won't change their ways because there is absolutely nothing in it for them. They already have the billions stolen from the countries treasuries. Why release political prisoners and change to a democratic system when you had the power of life and death over their subjects for years?
However, once they die then new possibilities are opened up almost immediately. Stalin's body wasn't even cold when Russia started instituting reforms. I can see us lifting the embargo the day after both Castros are put into the ground. Until then any US overture is a big waste of time. Sometimes change can only come over the body of a dictator.
The Cuban president suggested the communist government is not willing to appease Washington by embracing small political and social reforms on the island, saying in a speech before an international gathering of government ministers that "it is not Cuba who has to make gestures."
The Castros are in their 80s so it will just be a few more years until they are dead. After that Cuba will probably be a free and democratic society. I call this the "one-man roadblock to peace" principal. You had this with Stalin, Yasser Arafat, and Kim Jong Il. You might have had this with Saddam too if we didn't remove him from power.
These roadblocks are usually old men with shaky heirs that they probably can't entrust their country to. They want to hold on to power and not be marginalized after terrorizing their country for decades. They won't change their ways because there is absolutely nothing in it for them. They already have the billions stolen from the countries treasuries. Why release political prisoners and change to a democratic system when you had the power of life and death over their subjects for years?
However, once they die then new possibilities are opened up almost immediately. Stalin's body wasn't even cold when Russia started instituting reforms. I can see us lifting the embargo the day after both Castros are put into the ground. Until then any US overture is a big waste of time. Sometimes change can only come over the body of a dictator.
Tuesday, April 28, 2009
Apple and Verizon Team Up?
There seem to be some rumors swirling about Verizon and Apple teaming up to deliver an IPhone Lite.
Allegedly, one device would be a thinner, lighter, and lower-priced version of the iPhone--an iPhone Lite, if you will. While the other device would be something akin to the jumbo iPod Touch that we wrote about previously. BusinessWeek's anonymous source describes it as a "media pad that would let users listen to music, view photos, and watch high-definition videos."
I think the iPhone Lite is just a rumor to extend the AT&T deal at Apples terms. It gives AT&T the idea that Apple could walk-away at any time and join their competitor. I think Apple would just love to sell their iPhone to every cell phone company in the world but just can't due to the AT&T deal. Now AT&T will have to shell out big bucks or Apple will do just that in 2010.
However their new Netbook-like ITouch device looks really nice but I can't see how much margin they can squeeze out of the thing. I just have a hard time seeing this thing selling for more than $300 but I could be wrong.
Allegedly, one device would be a thinner, lighter, and lower-priced version of the iPhone--an iPhone Lite, if you will. While the other device would be something akin to the jumbo iPod Touch that we wrote about previously. BusinessWeek's anonymous source describes it as a "media pad that would let users listen to music, view photos, and watch high-definition videos."
I think the iPhone Lite is just a rumor to extend the AT&T deal at Apples terms. It gives AT&T the idea that Apple could walk-away at any time and join their competitor. I think Apple would just love to sell their iPhone to every cell phone company in the world but just can't due to the AT&T deal. Now AT&T will have to shell out big bucks or Apple will do just that in 2010.
However their new Netbook-like ITouch device looks really nice but I can't see how much margin they can squeeze out of the thing. I just have a hard time seeing this thing selling for more than $300 but I could be wrong.
Specter Leaves the GOP
I'm not so sure if this move will be much of a power change in the Senate.
Specter was facing a nearly impossible primary challenge from his conservative nemesis, Pat Toomey, whom he defeated by just 17,146 votes (or 1.6% of the vote) in 2004. Specter's unpopular vote in support of Obama's stimulus package in February drove many of Pennsylvania's diminishing Republican votes to Toomey, giving him an edge of 41%-27% in one recent poll.
So he cut his losses and crossed the aisle. He still seems to be a moderate and against such abuses as the card check that allows unions to form at Best Buy or Wal-Mart or wherever. If you want to see the power of unions they now own 55% of the nearly bankrupt Chrysler. If you can honestly say that a company that has UAW members on the board (so they will *never* get rid of their wage and benefits baggage) will actually be able to compete on costs with Nissan and Toyota then you are crazy.
If Wal-Mart or Best Buy unionized then we get stuck with the wage increases in the form of higher prices. I guess it will be a great time to go long Amazon because their pricing advantage will be enormous.
Specter might be behind Obama's "rip off the unborn grandkids" budget scheme because he supported the bailout but I'm not so sure. He seems to be a fairly moderate spender compared to some on the Dems. They sure won't be getting a far-left liberal in that job that's for sure.
Specter was facing a nearly impossible primary challenge from his conservative nemesis, Pat Toomey, whom he defeated by just 17,146 votes (or 1.6% of the vote) in 2004. Specter's unpopular vote in support of Obama's stimulus package in February drove many of Pennsylvania's diminishing Republican votes to Toomey, giving him an edge of 41%-27% in one recent poll.
So he cut his losses and crossed the aisle. He still seems to be a moderate and against such abuses as the card check that allows unions to form at Best Buy or Wal-Mart or wherever. If you want to see the power of unions they now own 55% of the nearly bankrupt Chrysler. If you can honestly say that a company that has UAW members on the board (so they will *never* get rid of their wage and benefits baggage) will actually be able to compete on costs with Nissan and Toyota then you are crazy.
If Wal-Mart or Best Buy unionized then we get stuck with the wage increases in the form of higher prices. I guess it will be a great time to go long Amazon because their pricing advantage will be enormous.
Specter might be behind Obama's "rip off the unborn grandkids" budget scheme because he supported the bailout but I'm not so sure. He seems to be a fairly moderate spender compared to some on the Dems. They sure won't be getting a far-left liberal in that job that's for sure.
Brokerage Error Crushes Dendreon Stock: But Provenge Study a Success
There might have been a mishit of some keys at a brokerage firm that went on right before trading was halted.
In a statement, Nasdaq spokesman Wayne Lee said the exchange investigated trades between 1:25 and 1:27 p.m., the same time as the plunge. He said the trades will stand and that the decision cannot be appealed. Trading in Dendreon shares remained halted until market close.
Shares fell $9.74, or 45.2 percent, to $11.81 in afternoon trading before trading was halted. Shares were rising before the study was released at the American Urological Association's annual meeting in Chicago Tuesday.
Out of all the information, this is the part that should be looked at by the FDA.
Median survival was 26 months in men given Provenge and 22 months in the others. Three-year survival rates were 32 percent for the Provenge group and 23 percent for the others -- a 38 percent improvement.
It is either this or having to take Taxotere and face all of its painful side effects. Now the next study has to be if men take Provenge earlier in their prostate cancer cycle then what will happen to the disease. You figure that since your body itself is being helped to kill the cancer then it should work even better.
Also the FDA might be facing a lawsuit from patient groups because basically they kept this thing off the market for 2 years even though they said it was safe and their own advisory panel said it was effective. Imagine all of the lost months that end-stage prostate cancer patients would have gotten to live if the FDA listened to that advisory panel.
Monday, April 27, 2009
Air Force 1 Buzzes New Yorkers
I think these people should understand that *any* low flying jet plane in Manhattan would immediately be thought of as a terrorist attack.
The White House apologized Monday after one of Barack Obama's presidential planes flew alarmingly low over New York city, sending residents into a panic and triggering fears of a new 9/11.
Of course it would have all been cool if it was to rush Obama to an emergency Swine Flu meeting of the United Nations or something. But the reason given was an absolute joke.
Sources said the chief reason for the panic-inducing flight was to create souvenir pictures of Air Force One flying over the Statue of Liberty to be given out - like a presidential tie clip - to family, friends or supporters.
Yup they scared New Yorkers and forced some to evacuate their buildings for presidential souvenir photos. I think there needs to be Congressional hearings on this and whoever is responsible for okaying this mission needs to resign.
The White House apologized Monday after one of Barack Obama's presidential planes flew alarmingly low over New York city, sending residents into a panic and triggering fears of a new 9/11.
Of course it would have all been cool if it was to rush Obama to an emergency Swine Flu meeting of the United Nations or something. But the reason given was an absolute joke.
Sources said the chief reason for the panic-inducing flight was to create souvenir pictures of Air Force One flying over the Statue of Liberty to be given out - like a presidential tie clip - to family, friends or supporters.
Yup they scared New Yorkers and forced some to evacuate their buildings for presidential souvenir photos. I think there needs to be Congressional hearings on this and whoever is responsible for okaying this mission needs to resign.
Friday, April 24, 2009
Job Opportunity: Pirate Killer!
It seems that shippers might have an added cost of doing business due to these stupid Somali pirates.
Plus if they are Americans of Frenchmen on board there is a good chance that the pirates would execute them so guards will certainly go a long way to stopping that.
In response to questions from a House Appropriations subcommittee, Petraeus said defensive preparations short of armed guards "can work. You can have water hoses and others that can make it more difficult."
But in a wry tone, he added: "It's tough to be on the end of a water hose if the other guy is on the end of an RPG. So you've got to think your way through that calculation as well."
Some ports don't allow ships with armed guards to enter so what these shippers could do is use a helicopter to let the guards off on shore just before they get into port. That is a lot of extra costs but it is better then having to pay millions in ransom if your boat is hijacked.Plus if they are Americans of Frenchmen on board there is a good chance that the pirates would execute them so guards will certainly go a long way to stopping that.
Janet Napolitano Kind of Aplogizes for Slandering Vets
At least she admitted that one of her people made a mistake:
Napolitano blamed one of her agency's analysts for prematurely sending out the intelligence assessment to law enforcement, according to Craig Roberts, an American Legion member who attended the meeting. The report says veterans returning from Iraq or Afghanistan could be susceptible to right-wing recruiters or commit lone acts of violence.
I hope that person has be reprimanded for pretty much saying that Vets risking life and limb in Iraq and Afghanistan could go nuts and commit acts of violence once they come home. That fit every Vietnam-era paranoid fantasy on the left of Vets will be crazy from war and start killing people indiscriminately.
Notice though that Napolitano didn't apologize for the actual content of the report but just that it was released early. You got to love that typical politician double-speak.
Napolitano blamed one of her agency's analysts for prematurely sending out the intelligence assessment to law enforcement, according to Craig Roberts, an American Legion member who attended the meeting. The report says veterans returning from Iraq or Afghanistan could be susceptible to right-wing recruiters or commit lone acts of violence.
I hope that person has be reprimanded for pretty much saying that Vets risking life and limb in Iraq and Afghanistan could go nuts and commit acts of violence once they come home. That fit every Vietnam-era paranoid fantasy on the left of Vets will be crazy from war and start killing people indiscriminately.
Notice though that Napolitano didn't apologize for the actual content of the report but just that it was released early. You got to love that typical politician double-speak.
GM Forced to Shutter Pontiac Brand
Well it seems that yet another venerable car brand will be no more.
General Motors Corp., facing the threat of a bankruptcy filing if it can’t meet a June 1 U.S. deadline, will preserve the GMC truck line and drop its 83-year- old Pontiac brand as part of a government-led recalibration of its business plan, people familiar with the decision said.
This move might be able to save enough money to make GM profitable if it sells as few as 10 million cars a year. It must suck to live in a town that supports a Pontiac plant though. You can see that GM was competing against themselves for some time. I couldn't tell the difference between a Chevy and a Pontiac on their website. They had nearly identical sedans. So I guess only people that had Pontiac GTO or a Trans-Am back in the 60-70s are giving it much thought.
General Motors Corp., facing the threat of a bankruptcy filing if it can’t meet a June 1 U.S. deadline, will preserve the GMC truck line and drop its 83-year- old Pontiac brand as part of a government-led recalibration of its business plan, people familiar with the decision said.
This move might be able to save enough money to make GM profitable if it sells as few as 10 million cars a year. It must suck to live in a town that supports a Pontiac plant though. You can see that GM was competing against themselves for some time. I couldn't tell the difference between a Chevy and a Pontiac on their website. They had nearly identical sedans. So I guess only people that had Pontiac GTO or a Trans-Am back in the 60-70s are giving it much thought.
Thursday, April 23, 2009
Obama Does the Waterboarding Two-Step
I think someone finally told him that a wide net into waterboarding will catch quite a bit of Democrats in its clutches along with the Bush people.
In this case I think someone told him that Pelosi, Jane Harman and whoever else will end up targets of the commission and could face charges by his own AG. It would also hurt CIA operations in the future because the legal leg they have to stand on might end up changing every 4 to 8 years. How can these CIA guys know what is permissible when the judges that tell them what is legal get sent to jail every few years?
It would have also created a poisonous atmosphere of partisan recrimination and questions of who knew what and when and other nonsense. The GOP will fight him on everything if they were targeted over actions that the entire Congress took to protect the country. Finally, it would also raise the specter of the new guy in office will have carte blanche in the future to prosecute the old guy in office. They do that in Chile and Myanmar but not the US.
All Obama would gain is to "get Bush" and make liberals feel all good inside. Those bad-guy "Repugs" had to resort to extreme measures so we could get actionable intel out of murderous terrorists. Now they will be punished!
This commission would make the Daily KOS and HuffPo happy but at the expense of national security, the CIA, ruining any chance of bipartisanship, and the Dems caught approving torture being run out of office. So Obama changed his mind when the situation changes.
At the White House, spokesman Robert Gibbs sought to underscore Obama's resistance to an independent commission two days after the president himself said such an approach would be preferable to a partisan congressional investigation into the questioning techniques that critics say amount to torture.
Gibbs said that after internal White House debate, Obama determined the independent commission "concept didn't seem altogether that workable in this case."
I have to say that this "change your mind when more info comes in" Obama two-step (you could call it wishy-washy) is kind of jarring. I do think it is much preferable to not changing your mind no matter what. It goes back to the maxim of "when conditions change you change your mind" which I think is a fairly sound policy.In this case I think someone told him that Pelosi, Jane Harman and whoever else will end up targets of the commission and could face charges by his own AG. It would also hurt CIA operations in the future because the legal leg they have to stand on might end up changing every 4 to 8 years. How can these CIA guys know what is permissible when the judges that tell them what is legal get sent to jail every few years?
It would have also created a poisonous atmosphere of partisan recrimination and questions of who knew what and when and other nonsense. The GOP will fight him on everything if they were targeted over actions that the entire Congress took to protect the country. Finally, it would also raise the specter of the new guy in office will have carte blanche in the future to prosecute the old guy in office. They do that in Chile and Myanmar but not the US.
All Obama would gain is to "get Bush" and make liberals feel all good inside. Those bad-guy "Repugs" had to resort to extreme measures so we could get actionable intel out of murderous terrorists. Now they will be punished!
This commission would make the Daily KOS and HuffPo happy but at the expense of national security, the CIA, ruining any chance of bipartisanship, and the Dems caught approving torture being run out of office. So Obama changed his mind when the situation changes.
Amazon Earnings Very Strong: Could it be that people are avoiding the Gloomy Mall?
Amazon just keeps surprising people even though consumers are supposed to be cutting back.
Amazon.com Inc. said earnings climbed 24 percent to $177 million, or 41 cents per share, compared with $143 million, or 34 cents per share, in the year-ago quarter. That easily beat the 31 cents per share that analysts polled by Thomson Reuters expected.
The company said revenue rose 18 percent to $4.89 billion, slightly higher than analysts' expectations of $4.76 billion.
So they were able to increase the top and bottom line when some companies are facing double digit drops? I think more and more people are just moving their day to day spending from the mall to Amazon and taking advantage of Amazon Prime to save a buck.
I think one factor that might be driving Amazon sales is that malls are now some of the gloomiest places you can go to buy something. I mean Ward Warehouse which is close to my workplace is like a ghost town full of closed shops and restaurants and is mostly made up of darkened hallways and furtive, scared-looking merchants.
If I wanted to pick up some clothes or something I would much rather do a few clicks on Amazon then drive down to a Fallout 3-like wasteland of a mall. Amazon is cheerful and cheap while the mall is full-priced and gloomy. It is not such a hard choice to make.
Amazon.com Inc. said earnings climbed 24 percent to $177 million, or 41 cents per share, compared with $143 million, or 34 cents per share, in the year-ago quarter. That easily beat the 31 cents per share that analysts polled by Thomson Reuters expected.
The company said revenue rose 18 percent to $4.89 billion, slightly higher than analysts' expectations of $4.76 billion.
So they were able to increase the top and bottom line when some companies are facing double digit drops? I think more and more people are just moving their day to day spending from the mall to Amazon and taking advantage of Amazon Prime to save a buck.
I think one factor that might be driving Amazon sales is that malls are now some of the gloomiest places you can go to buy something. I mean Ward Warehouse which is close to my workplace is like a ghost town full of closed shops and restaurants and is mostly made up of darkened hallways and furtive, scared-looking merchants.
If I wanted to pick up some clothes or something I would much rather do a few clicks on Amazon then drive down to a Fallout 3-like wasteland of a mall. Amazon is cheerful and cheap while the mall is full-priced and gloomy. It is not such a hard choice to make.
Poll Shows that 80% Think that More Debt will Hurt Future Generations
In a recent poll it seems that Obama's right direction numbers have finally edged ahead of his wrong direction numbers.
In a sign that Barack Obama has inspired hopes for a brighter future in the first 100 days of his presidency, an Associated Press-GfK poll shows that 48 percent of Americans believe the United States is headed in the right direction — compared with 44 percent who disagree.
I think he should seriously be concerned about this part though:
_While there is evidence that people feel more optimistic about the economy, 65 percent said it's difficult for them and their families to get ahead. More than one-third know of a family member who recently lost a job.
_More than 90 percent of Americans consider the economy an important issue, the highest ever in AP polling.
_Nearly 80 percent believe that the rising federal debt will hurt future generations, and Obama is getting mixed reviews at best for his handling of the issue.
This shows that missteps on the economy or a feeling that Obama is standing in the way of people getting ahead will cost him dearly. And that last number makes it seem that they took this poll at a Tea Party rally or something. It think it is a good thing that 80% of people in this poll think that *even more* federal debt will hurt future generations.
I'm glad that a large majority of Americans are finally understanding that you can't pay off your credit card bill by applying for more credit cards. People are getting the message that more and more debt will short change future generations and force them to either default on the debt or work even harder to pay the interest. Either way Obama and the Dems will be placed squarely on the blame line.
In a sign that Barack Obama has inspired hopes for a brighter future in the first 100 days of his presidency, an Associated Press-GfK poll shows that 48 percent of Americans believe the United States is headed in the right direction — compared with 44 percent who disagree.
I think he should seriously be concerned about this part though:
_While there is evidence that people feel more optimistic about the economy, 65 percent said it's difficult for them and their families to get ahead. More than one-third know of a family member who recently lost a job.
_More than 90 percent of Americans consider the economy an important issue, the highest ever in AP polling.
_Nearly 80 percent believe that the rising federal debt will hurt future generations, and Obama is getting mixed reviews at best for his handling of the issue.
This shows that missteps on the economy or a feeling that Obama is standing in the way of people getting ahead will cost him dearly. And that last number makes it seem that they took this poll at a Tea Party rally or something. It think it is a good thing that 80% of people in this poll think that *even more* federal debt will hurt future generations.
I'm glad that a large majority of Americans are finally understanding that you can't pay off your credit card bill by applying for more credit cards. People are getting the message that more and more debt will short change future generations and force them to either default on the debt or work even harder to pay the interest. Either way Obama and the Dems will be placed squarely on the blame line.
Chrysler Moves Toward Bankruptcy: It Sucks to Be Their Creditor
Well it seems that our $7 billion "investment" in Chrysler is going to be destroyed along with much of the wealth of any of their debt holders.
The only major question that remains unresolved is what happens to Chrysler’s lenders, who hold $6.9 billion in company debt. The government’s most recent offer, presented Wednesday, would give the company’s lenders about 22 cents on the dollar, or $1.5 billion, and a 5 percent equity stake in a reorganized Chrysler. Earlier this week, a steering committee of the lenders proposed that they receive 65 cents on the dollar, or $4.5 billion, and a 40 percent equity stake.
However their UAW workers get to hold onto their pensions and health care benefits.
The Treasury has an agreement in principle with the United Automobile Workers union, whose members’ pensions and retiree health care benefits would be protected as a condition of the bankruptcy filing, said these people, who asked for anonymity because they were not authorized to discuss the case.
So basically if you loaned the company money (the taxpayers are in this camp unfortunately) you get 22 cents on the dollar and some stock in the company once it emerges from bankruptcy. But if you are a UAW member you don't have to worry about your pension or your health care expenses because I assume the taxpayer will be footing that bill.
I don't see anything about the bankruptcy voiding those UAW employment contracts so I assume those will be carried forward. So even when they leave bankruptcy they will *still* be at a salary and benefits disadvantage to the Japanese automakers.
I guess the fear of reprisal from the White House is keeping the debt holders from just forcing the company into Chapter 7 and liquidating Chrysler's assets to Fiat at a fire sale. You figure this action would net them more than a measly 22 cents on the dollar.
This whole thing tells you that if the government takes over your company for any reason then get rid of that companies debt immediately or you face getting only 22 cents on the dollar of your money back. Forget debt covenants or who is supposed to get what and when the government dictates terms. I'm sure the Cerberus Capital people must be hopping mad at this turn of events right about now.
The only major question that remains unresolved is what happens to Chrysler’s lenders, who hold $6.9 billion in company debt. The government’s most recent offer, presented Wednesday, would give the company’s lenders about 22 cents on the dollar, or $1.5 billion, and a 5 percent equity stake in a reorganized Chrysler. Earlier this week, a steering committee of the lenders proposed that they receive 65 cents on the dollar, or $4.5 billion, and a 40 percent equity stake.
However their UAW workers get to hold onto their pensions and health care benefits.
The Treasury has an agreement in principle with the United Automobile Workers union, whose members’ pensions and retiree health care benefits would be protected as a condition of the bankruptcy filing, said these people, who asked for anonymity because they were not authorized to discuss the case.
So basically if you loaned the company money (the taxpayers are in this camp unfortunately) you get 22 cents on the dollar and some stock in the company once it emerges from bankruptcy. But if you are a UAW member you don't have to worry about your pension or your health care expenses because I assume the taxpayer will be footing that bill.
I don't see anything about the bankruptcy voiding those UAW employment contracts so I assume those will be carried forward. So even when they leave bankruptcy they will *still* be at a salary and benefits disadvantage to the Japanese automakers.
I guess the fear of reprisal from the White House is keeping the debt holders from just forcing the company into Chapter 7 and liquidating Chrysler's assets to Fiat at a fire sale. You figure this action would net them more than a measly 22 cents on the dollar.
This whole thing tells you that if the government takes over your company for any reason then get rid of that companies debt immediately or you face getting only 22 cents on the dollar of your money back. Forget debt covenants or who is supposed to get what and when the government dictates terms. I'm sure the Cerberus Capital people must be hopping mad at this turn of events right about now.
Could the Taliban Take over Pakistan?
I sure hope not. But there seems to be just 65 miles separating the Taliban from Islamabad.
On Wednesday a local Taliban militia crossed from the Swat Valley - where a February cease-fire allowed the implementation of strict Islamic, or Shari'a, law - into the neighboring Buner district, which is just a few hours drive from Islamabad (65 miles, separated by a mountain range, as the crow flies).
So you could say that a mountain range (and not a vast army or even a river) now separates the capital of a nuclear armed nation from falling to Islamic hardliners. Forget about Iranian nukes because Pakistani nukes will be much scarier in the hands of the Taliban. Especially if they are aimed at our troops in Afghanistan.
One medium ranged missile fired by Taliban militiaman could wipe out an entire NATO division or sink an entire carrier group. Just having a few warheads slip out of the country will be enough to give the world a headache for decades to come.
At the same time Pakistan seems more afraid that Baluchistan might declare independence with the help of India.
Also on Wednesday, a top adviser to Pakistan Prime Minister Yousuf Raza Gilani made an explosive announcement accusing a long-simmering separatist movement in the province of Baluchistan of being sponsored by archenemy India and Afghanistan. The mysterious deaths of several Baluch leaders over the past few weeks have renewed demands for Baluch independence from the nation of Pakistan.
This might be paranoia but I can see the Pakistani point of view. Historically buffer states are very important when two nations are arch-enemies. That is why Poland kept getting taken over and built up in the course of European history. There seems to be no hard evidence that India is doing this though.
However I can see the advantage India would get from creating an allied buffer state out of part of Pakistan. That is especially true if Islamabad falls to the Taliban and Baluchistan declares independence. This would give India a chance to surge troops into Baluchistan as a "peacekeeping" force and maybe even invade Pakistan in the same vein.
Hell, even the US would gain from the creation of an Indian-allied Baluchistan because India would probably let us pour troops and material into the region to hunt for Al-Quida scumbags. Plus the Indian Army might be more willing to pair up with the US to fight against the Taliban as well. The Indians don't have that long association and aid of the Taliban that Pakistan has had in the past. The Indians might not have any objections with us flying Predators deep into Baluchistan to help them kill off Taliban leaders. In any case, Hillary's job has just gotten *much* harder.
On Wednesday a local Taliban militia crossed from the Swat Valley - where a February cease-fire allowed the implementation of strict Islamic, or Shari'a, law - into the neighboring Buner district, which is just a few hours drive from Islamabad (65 miles, separated by a mountain range, as the crow flies).
So you could say that a mountain range (and not a vast army or even a river) now separates the capital of a nuclear armed nation from falling to Islamic hardliners. Forget about Iranian nukes because Pakistani nukes will be much scarier in the hands of the Taliban. Especially if they are aimed at our troops in Afghanistan.
One medium ranged missile fired by Taliban militiaman could wipe out an entire NATO division or sink an entire carrier group. Just having a few warheads slip out of the country will be enough to give the world a headache for decades to come.
At the same time Pakistan seems more afraid that Baluchistan might declare independence with the help of India.
Also on Wednesday, a top adviser to Pakistan Prime Minister Yousuf Raza Gilani made an explosive announcement accusing a long-simmering separatist movement in the province of Baluchistan of being sponsored by archenemy India and Afghanistan. The mysterious deaths of several Baluch leaders over the past few weeks have renewed demands for Baluch independence from the nation of Pakistan.
This might be paranoia but I can see the Pakistani point of view. Historically buffer states are very important when two nations are arch-enemies. That is why Poland kept getting taken over and built up in the course of European history. There seems to be no hard evidence that India is doing this though.
However I can see the advantage India would get from creating an allied buffer state out of part of Pakistan. That is especially true if Islamabad falls to the Taliban and Baluchistan declares independence. This would give India a chance to surge troops into Baluchistan as a "peacekeeping" force and maybe even invade Pakistan in the same vein.
Hell, even the US would gain from the creation of an Indian-allied Baluchistan because India would probably let us pour troops and material into the region to hunt for Al-Quida scumbags. Plus the Indian Army might be more willing to pair up with the US to fight against the Taliban as well. The Indians don't have that long association and aid of the Taliban that Pakistan has had in the past. The Indians might not have any objections with us flying Predators deep into Baluchistan to help them kill off Taliban leaders. In any case, Hillary's job has just gotten *much* harder.
Wednesday, April 22, 2009
Obama Backs Columbian Trade Pact: First Foreign Policy Homerun!
Here is some credit where credit is due.
The president announced that his team must find a way to pass the agreement. With world trade down 80%, the pact opens new markets to the U.S. He demanded immediate action, asking Colombia's trade minister to fly to Washington this week.
Then it got even better: Obama invited Uribe to the White House and promised to visit Colombia himself, allowing the Colombians to lay out for him their vast economic and social progress, and their desire to integrate into global trade.
The best part about any agreement with Colombia is that it improves the quality of life of the average Colombian. The more access this person has to American markets the better chance they have of succeeding in the world economy. Plus this is the reward for Pres. Uribe for reforming his country and turning it into a stable, pro-US Democracy.
GM to Close US Factories This Summer
I guess they are trying to save money in any way that they can and that means not making as many cars as they did in previous years.
General Motors Corp. is planning to temporarily close most of its U.S. factories for up to nine weeks this summer because of slumping sales and growing inventories of unsold vehicles, two people briefed on the plan said Wednesday.
Too bad they don't get a chance to furlough the workers during that period and make the UAW pay their salaries during the time that the factories are shut down. That could give GM a breather in which they can build up some cash for the long haul.
General Motors Corp. is planning to temporarily close most of its U.S. factories for up to nine weeks this summer because of slumping sales and growing inventories of unsold vehicles, two people briefed on the plan said Wednesday.
Too bad they don't get a chance to furlough the workers during that period and make the UAW pay their salaries during the time that the factories are shut down. That could give GM a breather in which they can build up some cash for the long haul.
VMWare Dissapoints on Revenue Numbers
Their revenue seems to have missed the mark this past quarter. This number would worry me if I was long the stock:
VMware said the quarter's service revenue grew 48 percent to $213.3 million. The company added that its business mix continues to shift, with service revenue becoming a larger proportion of total sales. License revenue fell 13 percent during the quarter to $257 million.
That means for the time being people are sitting still and paying their service charges but are not ordering as many new copies of VMWare's Software. I think this may be because companies are trying to conserve cash by making due with what they have. So that means they are not looking to grow (and thus carry more virtual servers) for several quarters into the future. I think the stock might revisit lows and rebound once server software sales start to pick back up.
VMware said the quarter's service revenue grew 48 percent to $213.3 million. The company added that its business mix continues to shift, with service revenue becoming a larger proportion of total sales. License revenue fell 13 percent during the quarter to $257 million.
That means for the time being people are sitting still and paying their service charges but are not ordering as many new copies of VMWare's Software. I think this may be because companies are trying to conserve cash by making due with what they have. So that means they are not looking to grow (and thus carry more virtual servers) for several quarters into the future. I think the stock might revisit lows and rebound once server software sales start to pick back up.
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