Comments on: GM and Credit Default Swaps

By: MarkH

MarkH — Thu, 20 Nov 2008 03:15:47 +0000

Pension & health care @ $45.2B?

How much to give all U.S. auto workers a big payoff when their companies go belly-up? I suspect it’s too big to consider, but wouldn’t it be nice if we could?

What happens to the needs of the American public if the big 2.5 go out of business? How many cars are they selling every year? Who could replace that product flow?

By: MarkH

MarkH — Thu, 20 Nov 2008 03:12:46 +0000

where did i read the chinese are lookin to buy the big three? daily kos of huffpost today?

Here’s a curious triple-cross idea: what if some Americans who have influence from the WH to Detroit help the Chinese by destroying the car companies, helping China buy the pieces on the cheap and get huge ‘brokerage fees’? How could such a person (or people) ever be caught & prosecuted?

By: MarkH

MarkH — Thu, 20 Nov 2008 03:09:54 +0000

Just think - if the automakers go bankrupt, the hedge funds get their CDSs paid off by the US taxpayer, AND get to buy the assets cheap! Also, the labor unions are killed and all the pension obligations are passed along to Mr. & Mrs taxpayer.

So, Dems need to attempt to save the auto workers while using as little money as possible to do it. It’s a tightrope. Also, I can’t see Paulson using any added authorization under TARP, but it’s likely he would be the person to dole out ANY assistance monies. Bush would probably kill any program Dems authorize. Detroit is screwed for being Democratic.

By: masaccio

masaccio — Wed, 19 Nov 2008 23:16:42 +0000

Pension liability and health care obligations under the union contract are separate entries on the balance sheet. It looks like a total of $45.2bn

By: Hmmm

Hmmm — Wed, 19 Nov 2008 22:31:02 +0000

See masaccio’s previous posts on the CDS topic for some analyses of that idea.

By: dainbug

dainbug — Wed, 19 Nov 2008 22:28:44 +0000

Ok, so why not just make payment of all Credit Swaps ILLEGAL! Problem Solved! All anyone has really lost is their premiums, and we can then put them on a list and if there is any money left after this mess is cleaned up, then they can have ‘dibs’ on getting some pennies on the dollar of the premiums paid back.

Its a win win!

By: californiarealitycheck

californiarealitycheck — Wed, 19 Nov 2008 22:14:05 +0000

they won’t be able to run somtin here. let them buy it.

By: kittykitty

kittykitty — Wed, 19 Nov 2008 22:06:59 +0000

what happens if the chinese buy the auto cos? minimum wage jobs for scabs?

By: selise

selise — Wed, 19 Nov 2008 22:06:43 +0000

i’ll have more in a diary tomorrow, but for now just want to make sure folks know that the house agriculture committee is going to have a hearing on the role of credit derivatives in the U.S. economy – tomorrow at 10am.

By: kittykitty

kittykitty — Wed, 19 Nov 2008 22:04:12 +0000

“It’s easy to think of people who might want GM to fail. One group might be those who want to buy the pieces cheap. That might include other car companies, or private equity funds. Another group might be hostile governments, who might like to see the US lose industries that can produce weapons and war-fighting machines.”

where did i read the chinese are lookin to buy the big three? daily kos of huffpost today?