OT: Buying GM Stock, a steal at $2?

Originally Posted by brp987

If I purchase whatever widget it is that you produce, am I not paying your wage with which you fund your retirement savings?

that's the point...the reason GM needs a bailout is because no one was purchasing the "widget". In capitalism, we vote on a companies success with our dollars. Overwhelmingly, Americans, and the world have voted GM out of the car making business. And in a capitalist system, when you file chapter 11, your pension is done. No rights, no wrong, no moral judgements - it's just the set of rules that define a fair market.

When the fed steps in and (against the majority of Americas wishes) MAKES us responsible for GM's success, when they have failed miserably, that is called communism.

[Brucelee]

Originally Posted by Fred Demara

that's the point...the reason GM needs a bailout is because no one was purchasing the "widget". In capitalism, we vote on a companies success with our dollars. Overwhelmingly, Americans, and the world have voted GM out of the car making business. And in a capitalist system, when you file chapter 11, your pension is done. No rights, no wrong, no moral judgements - it's just the set of rules that define a fair market.

When the fed steps in and (against the majority of Americas wishes) MAKES us responsible for GM's success, when they have failed miserably, that is called communism.

One correction. Depending on how GM sets up its pension, chapter 11 may have no long term impact on one's ability to collect a pension. Employers are free to fund pensions in many ways. One way is for them to purchase annuties that are prefunded. Hence, a current pensioner's funds flow may be fine and may come from say, Prudential or Allstate.

Also, some pension funds are moved to the union, who is repsonsible for investments, payouts and the like.

Not sure how the UAW's sets up their pension arrangments.

http://finance.yahoo.com/tech-ticker/article/yftt_103116/What-Happens-if-GM-Goes-Bankrupt-Not-Much?tickers=gm,f

I feel sorry for you if your pension is with GM. I feel sorry for you if you lost your job because GM failed. But if we leverage the US into paying for a company that has a track record of being inept, we'll be setting ourselves up for a new level of inflation and dollar devaluation that will hurt our children, and their children.

So do we suffer now, and remain Capitalists? Or make our children pay later, and become socialists?

Originally Posted by Brucelee

One correction. Depending on how GM sets up its pension, chapter 11 may have no long term impact on one's ability to collect a pension. Employers are free to fund pensions in many ways. One way is for them to purchase annuties that are prefunded. Hence, a current pensioner's funds flow may be fine and may come from say, Prudential or Allstate.

Also, some pension funds are moved to the union, who is repsonsible for investments, payouts and the like.

Not sure how the UAW's sets up their pension arrangments.

[Brucelee]

I don't think anyone here is advocating saving GM or its pensioners. Nor are we suggesting socialism is where we want to go.

The original question was, should I buy GM stock"?

I think we all pretty much said that would be a mistake.

sorry to get all political...this will fix it...

http://www.youtube.com/watch?v=bPa-E4Yejuw&feature=related


enjoy

Originally Posted by Brucelee

I don't think anyone here is advocating saving GM or its pensioners. Nor are we suggesting socialism is where we want to go.

The original question was, should I buy GM stock"?

I think we all pretty much said that would be a mistake.

[Jaxonalden]

Originally Posted by Fred Demara

that's the point...the reason GM needs a bailout is because no one was purchasing the "widget". In capitalism, we vote on a companies success with our dollars. Overwhelmingly, Americans, and the world have voted GM out of the car making business. And in a capitalist system, when you file chapter 11, your pension is done. No rights, no wrong, no moral judgements - it's just the set of rules that define a fair market.

When the fed steps in and (against the majority of Americas wishes) MAKES us responsible for GM's success, when they have failed miserably, that is called communism.

The reason Americans aren't buying their "widget's"? Simple, GM has had their arms twisted by the UAW and have been paying their "ransom" for years. That money could have been reinvested back into the company for better R&D and materials to make a better product. Instead they have had to used cheap materials and old technology. Take the throttle body fuel injection for example, GM just stopped using that late 70's early 80's crap while the rest of the world has moved on and accelerated into direct injection. Also, has anyone pushed in on a fender lately? I swear a beer can is thicker!

Why don't I buy American cars? I'm NOT going to pad the pockets of UAW or the workers that really have the golden parachute pensions and benefit packages. As an American I have the freedom to make this choice, thank God.

[brp987]

Originally Posted by Fred Demara

that's the point...the reason GM needs a bailout is because no one was purchasing the "widget". In capitalism, we vote on a companies success with our dollars. Overwhelmingly, Americans, and the world have voted GM out of the car making business.

As I understand it, GM is profitable outside the US. Also, I see lots of GM cars and suv's around. Their bread and butter stuff may be bland, but most people aren't enthusiasts.

Originally Posted by Fred Demara

And in a capitalist system, when you file chapter 11, your pension is done. No rights, no wrong, no moral judgements - it's just the set of rules that define a fair market.

If someone invests their career with the assumption of a pension and that pension is taken away too late for them react, I wouldn't consider that right morally. Practically, the gov ends up assuming the pension, although at lesser value, so you and I end up paying anyway. I'm not a lawyer, but thats my understanding.

Originally Posted by Fred Demara

When the fed steps in and (against the majority of Americas wishes) MAKES us responsible for GM's success, when they have failed miserably, that is called communism.

Hey, I'm on-board with the Peter Schiff thing, but GM is small potatoes compared with the wreckless Wall Street and home=ATM crowd.

[threpwood]

My broker said GM will not go bankrupt in anyway because the stake is too high for Americans. The stock will continue to deplete and can probably reach 1 cent a share. I wonder why USA doesn't nationalized the GM and fired those dumb CEOs?

[Brucelee]

Originally Posted by threpwood

My broker said GM will not go bankrupt in anyway because the stake is too high for Americans. The stock will continue to deplete and can probably reach 1 cent a share. I wonder why USA doesn't nationalized the GM and fired those dumb CEOs?

A mild defense of the CEO of Ford. The guy has not been responsible for Ford's demise, as he has only been around a short while and he has done some good things. These companies took decades to get where they are.

Waggoner deserves the boot, but then so does about half of Congress.

1) GM makes money outside the US? Wonderful - when they file for chapter 11 and reorganize, maybe they'll be smart enough to focus on those markets.

2) Morally, I agree. It's sad, it's tragic, it's not fair - and sadly, in my experience - life isn't fair. It's morally wrong that a black child can't get into college because the inner city school he went to never taught him to read, because it was underfunded. It's morally wrong that firestation#26 in atlanta's staff has been cut 1/2 - and people are watching their homes burn to the ground due to short staffs...terrible, tragic...not fair. It's morally wrong that a vet can come home from Iraq after loosing both of his legs, and he can't get the proper VA benefits to treat him, or get him a decent pair of prosthetics. Tragic, sad, unfair, morally wrong.

My dad worked for Polaroid for 38 years. The government made a deal that paid him 6cents on the dollars for his retirement fund. It wasn't fair...but that's life, that's capitalism.

And I agree - the Madoff's of the world should be sent to prison for life. What happened to those who invested with him just wasn't morally fair.

Originally Posted by brp987

As I understand it, GM is profitable outside the US. Also, I see lots of GM cars and suv's around. Their bread and butter stuff may be bland, but most people aren't enthusiasts.

If someone invests their career with the assumption of a pension and that pension is taken away too late for them react, I wouldn't consider that right morally. .

[Jaxonalden]

Quote;
Fred Demara
"And I agree - the Madoff's of the world should be sent to prison for life. What happened to those who invested with him just wasn't morally fair."


You know, I agree it wasn't morally fair but, after watching the news program about the Madoff scam and who was affected I couldn't help but think "Why would people and organizations put so much trust in one man with their life savings?". There is only one answer, the seven deadly sins;

Lust, Gluttony, Greed (guaranteed 19% return), Sloth, Wrath, Envy and Pride.

Maybe this country needs a little moral adjustment by the seven deadly contrary virtues;

Chastity, Temperance, Diligence, Patience, Kindness and Humility.

Just my thoughts.

[Blue-S]

Originally Posted by Fred Demara

that's the point...the reason GM needs a bailout is because no one was purchasing the "widget". In capitalism, we vote on a companies success with our dollars. Overwhelmingly, Americans, and the world have voted GM out of the car making business. And in a capitalist system, when you file chapter 11, your pension is done. No rights, no wrong, no moral judgements - it's just the set of rules that define a fair market.

When the fed steps in and (against the majority of Americas wishes) MAKES us responsible for GM's success, when they have failed miserably, that is called communism.

I'm no fan of GM, but the concept that "no one was purchasing the widget" just doesn't fly. It was big news that Toyota finally overtook GM in 2008 as the world's largest automaker, as measured by sales. How can it be said that no one was buying the widget, when the company is #2 in sales?

All three of the Detroit automakers have been working on restructuring for several years, but during 2008 the twin blows of high gas prices (in the first three quarters) and the credit crisis have hammered the companies. Even almighty Toyota is suffering during this crisis -- they have announced that they estimate a $4.9 Billion loss for the 2008 fiscal year. The collapse of auto sales is hurting nearly all automakers; the companies that were in weak financial condition before the sales slump are obviously far closer to collapse than the financially stronger companies.

As for the loss of pension in a Chapter 11...that shouldn't happen. The PBGC exists to take over pension obligations when covered companies fold or restructure under Chapter 11. I sure hope that pensions are covered: I worked in salaried, non-bargaining-unit positions at one of the Detroit automakers for about 13 years, and I would sure like to collect the pension accrued on that service time when I eventually retire. Check out this link for details on the PBGC:

http://www.pbgc.gov/media/key-resources-for-the-press/content/page13542.html

regardless of how, and why GM is losing billions of dollars...the fact remains...GM is losing billions of dollars, and most of the "experts" agree (even some GM execs agree) that chapter 11 is the best route.

I really feel for anyone who has lost their pension, or is going to loose it...but the UAW is partly to blame for GM's current situation. They aren't innocent in destroying this once great company - and them lobbying congress to make us (and our children) libel for their misdeeds to protect their pension plans is morally wrong.

At least in my book.

Originally Posted by Blue-S

I'm no fan of GM, but the concept that "no one was purchasing the widget" just doesn't fly. It was big news that Toyota finally overtook GM in 2008 as the world's largest automaker, as measured by sales. How can it be said that no one was buying the widget, when the company is #2 in sales?


As for the loss of pension in a Chapter 11...that shouldn't happen.

http://www.pbgc.gov/media/key-resources-for-the-press/content/page13542.html

[Paul]

Obama will continue to find ways to protect unions.

http://washingtontimes.com/news/2009/feb/07/obama-signs-4th-pro-union-regulation/

http://www.thehotjoints.com/2009/01/30/obama-signs-union-pandering-executive-orders/

[Brucelee]

I don't "blame" the union for destroying GM. The union is free under US law to organize, bargain and strike, as long as they do it legally.

The company is responsible for what IT negotiates. They could have said no any time they wanted but usually, they chose to go along and push the cost out into the future.

Well, welcome to the future.

It is, what it is.

The union was just doing its job and clearly, did it better than management IMHO.

It's a good point...Do I blame a union rep for fighting for it's janitor to make 50/hour while his counterpart in Japan only makes 4.50/hour...Hell no. Good for them.

They had a great ride...but for 30 years the "experts" warned the big three that they needed to cut costs, or someday, they'd be looking down the barrel of a loaded gun. And that day is now.

And here we are...does it matter how we got here? Well, it'll make for good debate for future historians. Blame doesn't stop this titanic from sinking.

The question before American taxpayers right now is, are you willing spend billions of our money so the UAW will survive, and GM can continue to make sub-standard non-profitable products?

We all agree - it's not fair...it stinks...but it's happened to hundreds of thousands of other retiree's...it's life, it's not going to be easy. But printing money to pay a failed companies debt is not the answer...it's equally unfair to the generations behind us who'll have to pay the piper.

Originally Posted by Brucelee

I don't "blame" the union for destroying GM. The union is free under US law to organize, bargain and strike, as long as they do it legally.

The company is responsible for what IT negotiates. They could have said no any time they wanted but usually, they chose to go along and push the cost out into the future.

Well, welcome to the future.

It is, what it is.

The union was just doing its job and clearly, did it better than management IMHO.