‘Already Bankrupt’ GM Won’t Be Rescued by U.S. Loan
December 13th, 2008I’m not as convinced as these guys in the piece below. This is already a make-it-up-as-you-go kind of show. Why couldn’t Hank and Ben just wave their magic wands and declare that GMAC qualifies as a bank, or whatever other damn thing they want to call it?
Via: Bloomberg:
For General Motors Corp., the question is no longer whether it will get a government loan or if Chief Executive Officer Rick Wagoner will be replaced. It’s whether anything can prevent the largest U.S. automaker from sliding into bankruptcy.
Even an offer by the Treasury Department today to provide temporary relief, after the Senate rejected a bailout plan approved by the House, isn’t likely to offset the Dec. 10 announcement that GM’s 49 percent-owned affiliate, GMAC LLC, lacked the capital to become a bank holding company. That means the financing unit won’t be able to access Treasury’s Troubled Asset Relief Program to help make auto loans.
GMAC may now have to file for Chapter 11 protection, with or without a loan, joining GM’s biggest parts supplier, Delphi Corp., which is already in bankruptcy. The Detroit-based automaker, leaking $67 million a day — enough to buy a fleet of 1,800 Cadillac CTS coupes — may soon be sucked into the vortex.
“GM already is bankrupt and should file for bankruptcy,” said David Littman, senior economist for the Mackinac Center for Public Policy, a policy research organization in Midland, Michigan. “They have too much overhead and too little time left to reduce size to be a survivor in this industry.”
The company eschewed the Chapter 11 option for months, believing it would make consumers unwilling to buy their cars. Lead director George Fisher said last week that bankruptcy is “way down the list of options.” GM has been working with New York lawyer Martin Bienenstock of Dewey & LeBoeuf to devise an option for using the bankruptcy process to restructure, according to a person familiar with the contingency plan.
Welcome to the condition of the rest of USALAND’s population GM et al.
How do you like being paid “just in time”?
Welcome aboard to the sinking ship (you helped create)with rest of us.
Glad to have you aboard.
I mean whats the big deal,…(hypothetically)if I and most others don’t get paid for all intents and purposes we are bankrupt until we do.
Paycheck to paycheck sucks dont it?
Don’t cry,…it tarnishes your image.
The best your phony marketers and emergency focus group sessions that cost $600k+ could come up with was to drive hybrids to DC instead of fly?
Methinks they hath failed to sway the masses.