WinkyDog

Once the Obama Administration takes office, the UAW will have a powerful ally against the Big 3.

Bush handed the Union a huge victory today.  Their stalling paid off.

Democrats, who don’t understand that unless car sales return to the levels they were at before the financial crisis, automotive companies cannot survive with current labor and legacy costs.  They beleive the Big 3 can save themselves by producing more expensive, smaller, greener automobiles.  Cars that people have not wanted to buy, in sufficient numbers, in the past.

Washington will not force the UAW to renegotiate their contract.  Detroit is doomed, sooner or later.

It’s too bad that the Big 3 don’t have negotiators as skilled, and daring, as Gettelfinger.

An industry that could never sustain itself in the first place, needs more money than they’ve already gotten from the American Taxpayers.  On top of that, they would like to destroy the Auto Industry and worsen the food shortage while they’re at it.

From WSJ:

First, it was Wall Street. Then Detroit auto makers. Now, the nation’s ethanol producers, who have hit a rough patch with the drop in ethanol prices, are seeking help from Washington.

The Renewable Fuels Association, a trade group for the U.S. ethanol industry, has spoken with staff members from Capitol Hill and President-elect Barack Obama’s team and “provided them with some ideas on how to craft the language of” an economic recovery package, said Matt Hartwig, a spokesman for the RFA.

Hartwig said RFA has suggested a number of steps including setting up a $1 billion short-term credit facility so ethanol producers could finance current operations; a $50 billion federal loan guarantee program to finance investment in new renewable fuel production capacity and supporting infrastructure; and a requirement that any auto maker receiving federal aid only produce new vehicles that can run on any blend up to 85% ethanol, beginning with the 2010 model season.

The price of ethanol has dropped with the price of oil, squeezing producers’ profit margins. Critics note that the U.S. ethanol industry already benefits from a number of fairly generous federal subsidies, including a tax credit paid to gasoline producers for blending gasoline with ethanol; a federal renewable-fuel standard that sets a minimum amount of ethanol to be blended into gasoline; and a 54-cents-per-gallon tariff on imported ethanol.

The RFA is one of many business groups looking for help in the financial stimulus legislation expected to move through Congress early next year. It’s not clear how much support RFA has for its proposals; calls to several senior lawmakers close to the industry weren’t immediately returned.

“We’re not asking for a specific bailout, but rather, as a trade association, we’re providing ideas to an incoming Congress and a new administration about ways to bolster the domestic renewable fuel industry,” Hartwig said. “We’re doing what all trade organizations are doing - providing the Obama administration with ideas.”

UPDATE: Hartwig calls back to add that his group offered ideas to the Obama team after being approached by a transition representative seeking the RFA’s input on what should be included in an economic recovery package; “We are not, I repeat, not asking for anything or lobbying for anything,” Hartwig said.

Posted December 12th, 2008 at 10.25am in Entrepreneurship.
With the Senate’s rejection of a bailout for Detroit’s ailing automakers, there now comes word that President Bush is actively considering using funds allocated by Congress for the Trouble Asset Relief Program (TARP) to prop up the automakers for the time being. Such action would be wrong legally, wrong economically, and counterproductive to turning around these troubled businesses. And by opening the door to such open-ended use of taxpayer money for virtually unlimited uses, a unilateral decision to employ TARP funds would jeopardize George W. Bush’s legacy as a friend of the taxpayer.
Until now, the Bush administration has resisted repurposing TARP funds for industrial policy, though this morning comes word that the Treasury may have reversed course. TARP, administration officials have said, was intended to shore up the stability of the financial markets and stave off economic collapse, not to inject capital into failing non-financial businesses. Moreover, only $15 billion remains of the initial $350 billion in TARP funds disbursed by Congress.
More problematic, Treasury lacks the statutory authority to direct TARP dollars to the automakers. While the statute, passed by Congress in October, grants the secretary extremely broad discretion to decide how to employ the funds, it clearly limits the recipients to “financial institutions.” And the definition of that term is quite clear:
FINANCIAL INSTITUTION- The term ‘financial institution’ means any institution, including, but not limited to, any bank, savings association, credit union, security broker or dealer, or insurance company, established and regulated under the laws of the United States or any State, territory, or possession of the United States, the District of Columbia, Commonwealth of Puerto Rico, Commonwealth of Northern Mariana Islands, Guam, American Samoa, or the United States Virgin Islands, and having significant operations in the United States, but excluding any central bank of, or institution owned by, a foreign government.
This doesn’t leave much room for interpretation.
In this case, due to the enumeration of included institutions in the statute, the term “any institution” is necessarily defined, in part, by the list that follow it: “bank, savings association, credit union, security broker or dealer, or insurance company.” An automaker is unlike any of these things, being a manufacturer of goods, not a financial intermediary.

WASHINGTON (Reuters) - Recent data suggests that many borrowers who received help with mortgage modifications earlier this year tended to re-default on their payments, a top U.S. banking regulator said on Monday.

“The results, I confess, were somewhat surprising, and not in a good way,” said John Dugan, head of the U.S. Office of the Comptroller of the Currency, in prepared remarks for a U.S. housing forum.

“Put simply, it shows that over half of mortgage modifications seemed not to be working after six months,” he said.

[...]

Dugan said recent data showed that after three months, nearly 36 percent of borrowers who received restructured mortgages in the first quarter re-defaulted.

The rate of re-default jumped to about 53 percent after six months and 58 percent after eight months, Dugan said, without providing an explanation for the trend.

Regulators speaking at an OTS-housing forum did not provide any explanations for the causes behind the data.

“We don’t know the answers yet, but these are the types of questions that we have begun asking our servicers in detail,” Dugan said.

[...]

Of coarse they know the answer.  No one was taken advantage of by evil lenders.  It was the borrowers that took advantage of the mortgage providers.  And the government rewarded them with special modifications, while those who work had and pay their bills got nothing.

People who had no business owning a home, who had no way of paying for their homes, lined up to get mortgages, pushed by liberals who think that home ownership is as much of a Right as health care and a high paying job.

None of this is a secret.  Every politician knows it.  Each one of the Presidential candidates knew it.  But no one will, or would, voice it, because they had votes to buy.

America needs to get back to rewarding excellence and achievement, not the opposite.

Due to crushing labor and legacy costs, as well as government regulation and mandates, the Big Three automakers have been operating much like someone living paycheck to paycheck.

As long as Americans were buying cars, they were just making it.  However, once the credit markets froze, and the public came to realize how bleak the economic future appeared, auto sales plummeted.

Making little to no money on much of their domestic auto sales, it has proven impossible for the automakers to sustain viability.  GM new car sales fell 41% in November.  However this was not the fault of GM products or Management decisions.  Toyota’s sales declined 34% in the same period.  It was solely the result of the credit crunch.

Senator Dodd led the fight to stop any regulation or oversight of Fannie Mae and Freddy Mac, when many where warning of the consequences of doing nothing.  So with so much blame for the Credit Crisis resting on his shoulders, I would like to see Chris Dodd offer his resignation right next GM CEO, Rick Wagoner.

Mr. Wagoner may be guilty of bowing to the Unions and government regulation.  And he is certainly at fault for so many utterly uninspiring automobiles that come off of General Motors assembly lines.  But Rick Wagoner, and the other automotive CEOs, are not responsible for the current financial crisis, that has slashed new auto sales nearly in half.  That blame falls to the Senators and Congressmen that protected and promoted the sub-prime mortgage debacle, and they should face consequences far more serious than the loss of their jobs.

 

Venezuelan President Chavez says Russia will help build its first nuclear reactor in the northwestern province of Zulia.    “A nuclear reactor, to produce energy for peaceful purposes, will soon be built in Estado Zulia and named in honor of the Venezuelan scientist of the last century Humberto Fernandez Moran,” Chavez told supporters in Maracaibo, the capital of Zulia state on Sunday, RIA Novosti reported.  “Brazil has several nuclear reactors, as does Argentina. We will also have our own reactor,” he said.  On Friday, Chavez revealed plans of broadening nuclear ties with Russia and said he would discuss the Issue with President Dmitry Medvedev during his visit of the Latin American country later this month.  Moscow and Caracas are expected to discuss large-scale cooperation projects in the energy sector, gas and petrochemical industries during the Russian president’s November visit to Venezuela.  While the US and its NATO allies are eyeing eastward expansion in a bid to circle Russia, Moscow is strengthening ties with Latin America, the US backyard.  Chavez earlier said that Latin American countries need strong relations with Russia to reduce US influence in the region and maintain peace and stability.  RB/MMN

By VOA News  28 November 2008

Russian President Dmitri Medvedev has met in Cuba with the island’s former president, Fidel Castro, capping a four-nation tour of Latin America in a bid to bolster ties in the region.

Mr. Medvedev met privately with the 82-year-old Castro for more than an hour Friday.  Russian officials say Mr. Medvedev and the former Cuban president discussed relations between their countries and international policy.  No further details of the meeting were released.

Russia’s Dmitri Medvedev (L), and Cuba’s Raul Castro at the tomb of the unknown Soviet soldier, Havana, 28 Nov 2008

Earlier, the Russian leader laid a wreath at a monument to Soviet soldiers with Mr. Castro’s brother, current President Raul Castro.  

On Thursday, Mr. Medvedev and Raul Castro met privately and also with delegations from each country.  They visited a monument to Cuba’s independence hero Jose Marti and a recently inaugurated Russian Orthodox cathedral.

Mr. Medvedev was visiting Cuba to revive ties with the former Soviet Union’s Cold War ally.

The Soviet Union was Cuba’s main benefactor during the Cold War, but the collapse of the Soviet bloc in 1991 battered Cuba’s economy and strained relations between the two countries.

Russian officials said Mr. Medvedev’s tour, which also took him to Venezuela, Brazil and Peru, was meant to boost trade, not provoke the United States in its sphere of influence.

The Russian president’s visit followed a recent trip to Cuba by Chinese President Hu Jintao. Mr. Hu and Raul Castro, both communist leaders, discussed strengthening relations between the two countries.

Fidel Castro, who ruled Cuba for nearly five decades, has not been seen in public since undergoing emergency surgery in July 2006.  Raul, who served as interim leader, became president in February.

Some information for this report was provided by AP.

Embattled mortgage giants Fannie Mae and Freddie Mac will suspend foreclosure sales and evictions on certain properties until January to give servicers more time to help borrowers avoid foreclosure.

[...]

The temporary suspension announced Thursday applies to 10,000 borrowers with Fannie-owned mortgages and 6,000 with Freddie-owned mortgages in occupied single-family and two- to four-unit properties with foreclosure sales scheduled between Nov. 26 and Jan. 9.

[...]

“By working closely with FHFA and our servicers, Freddie Mac is on track to help three out of every five troubled borrowers with Freddie Mac-owned loans avoid foreclosure this year,” Freddie Chief Executive David M. Moffett said.  [...]
(WSJ)

And the insults to hard working Americans, who pay their bills, keep on coming.  The Makers and the Takers.

Your neighbor doesn’t pay his mortgage, and the Feds are going to allow him to stay in his house anyway.  And if you think that will change in January, you’re crazy.  It will be worse in the new year.