MSNBC is running all of Obama's "accomplishments". Just because a bill is labeled "financial reform" does not make it so. Giving the Banksters carte blanche is not reforming and saving Wall Street. Passing Obamacare is not passing universal health care (which we need). Spin goes on and on.
The funny thing as people run off to buy this piece of crap or that piece of crap in our anti-Thoreau, consumerism rules all, let's not think but look to puppets on TV to "inform" us society, people literally writing and thinking about the same issues for 2500+ years have dealt with these issues, discussed them, fought over them, etc., etc. Homer, Socrates, Plato, Cicero, writers in the Islamic world, China and the rest of Asia, etc. across the globe in terms and in arguments that should carry weight today in terms that easily exceed our own present "discourse." And that's why history repeats itself, because the people in power purposely ignore history and convince us "this time it's different." Yeah, whatever narcissistic dolts in charge. And yet here we are in 2012 and it's pure regression, like thinking and reading and writing are lost arts! Can you imagine?! And that's why folks in power don't want too many of us reading, writing, thinking, and dissenting but only listening and buying, buying, and buying, whether it's buying their bullsh*t or buying bullsh*t that has a pricetag at a store or online.
On this Election Eve, let's raise our drinks (or tea or other drink, for those that abstain) to true patriotism and dissent and thought, from Tank Man, to Sophie Scholl, to Paine all the way to antiquity whose names are long forgotten but made a difference as best they could, often at the expense of their own safety. Cheers!
What kills me is the spin on the auto bail out. Hopefully EPers know by now I stick to policies, issue specifics and a hell of a lot of statistics, so this is by now means an endorsement. I think it's pretty clear I personally think both parties are corrupt, bought and paid fors...
One thing is clear, media is biased as hell. FOX is a walking Romney advertisement, CNN, MSNBC is a walking Obama advertisement.
Sometimes being a gadfly is all a man or woman can do, just ask Socrates.
WRITE-INS are an option, never forget that! Even if it is "none of the above," "banksters win no matter what," "who cares, two sides of same coin," "the 99%," "all politicians are narcissistic psychopaths, who cares," "this system is f*cked," or something else, if you aren't happy with any of the choices, by all means, you don't have to play along. Also, any dissent whatsoever clogs the system up for just one minute more while those wishing to just get along are delayed and might think "why is someone writing in a vote?" And that one moment of thought is enough to convince one person or more, then it's good and noble.
On this election eve, reading Paine's Agrarian Justice and his other works, just think of how far we've fallen. For those that love our Founding Fathers in name only while enriching oligarchs or big bosses of this union or that or this politician's family or that, a little Paine:
"Personal property is the effect of society. . . Separate an individual from society, and give him an island or a continent to possess, and he cannot acquire personal property. . . All accumulation therefore of personal property, beyond what a man's own hands produce, is derived to him by living in society; and he owed, on every principle of justice, of gratitude, and of civilization, a part of that accumulation back again to society from whenve the whole came." Agrarian Justice, 1797.
Carlin:
"The real owners are the big wealthy business interests that control things and make all the important decisions. Forget the politicians, they're an irrelevancy. The politicians are put there to give you the idea that you have freedom of choice. You don't. You have no choice. You have owners. They own you. They own everything. They own all the important land. They own and control the corporations. They've long since bought and paid for the Senate, the Congress, the statehouses, the city halls. They've got the judges in their back pockets. And they own all the big media companies, so that they control just about all of the news and information you hear. They've got you by the balls. They spend billions of dollars every year lobbying lobbying to get what they want. Well, we know what they want; they want more for themselves and less for everybody else."
"But I'll tell you what they don't want. They don't want a population of citizens capable of critical thinking. They don't want well-informed, well-educated people capable of critical thinking. They're not interested in that. That doesn't help them. That's against their interests. They don't want people who are smart enough to sit around the kitchen table and figure out how badly they're getting fucked by a system that threw them overboard 30 fucking years ago.
"You know what they want? Obedient workers people who are just smart enough to run the machines and do the paperwork but just dumb enough to passively accept all these increasingly shittier jobs with the lower pay, the longer hours, reduced benefits, the end of overtime and the vanishing pension that disappears the minute you go to collect it. And, now, they're coming for your Social Security. They want your fucking retirement money. They want it back, so they can give it to their criminal friends on Wall Street. And you know something? They'll get it. They'll get it all, sooner or later, because they own this fucking place. It's a big club, and you ain't in it. You and I are not in the big club."
It's unbelievable, groups are asking for volunteers to call people via email, viral videos are planted with 1.5 million hits, as if it means something. Article plants are everywhere.
May I suggest if people are still undecided, take care in what you view out there.
The New Yorker has a pretty good article on private equity firms and makes reference to this practice of dumping pensions onto the PBGC. Robbing pensions by hedge funds is seemingly the one save by team Obama, not clearly "not quite"...to me bottom line this should be made illegal and pension obligations shouldn't be allowed to declare bankruptcy on, plus executive officers should face criminal charges by not fully funding pensions.
As a result, private-equity firms are increasingly able to profit even if the companies they run go under—an outcome made much likelier by all the extra borrowing—and many companies have been getting picked clean. In 2004, for instance, Wasserstein & Company bought the thriving mail-order fruit retailer Harry and David. The following year, Wasserstein and other investors took out more than a hundred million in dividends, paid for with borrowed money—covering their original investment plus a twenty-three per cent profit—and charged Harry and David millions in “management fees.” Last year, Harry and David defaulted on its debt and dumped its pension obligations. In other words, Wasserstein failed to improve the company’s performance, failed to meet its obligations to creditors, screwed its workers, and still made a profit. That’s not exactly how capitalism is supposed to work.
Hedge funds did get 33¢ on the dollar, per-negotiated and then 29¢ on the dollar as a deal, but these are junk bonds, so what they bought in at is another question. Hedge funds did make out in the GM bankruptcy.
"Price of parts", I'm not sure what you mean. Most of those "parts" are now coming in as Chinese imports as Delphi was pretty much shipped off to China.
GM bought some of the Delphi and with government funds. But Delphi entered bankruptcy in 2005, long before the auto bail out. Hedge funds already owned the Delphi bonds for they moved in during 2005.
So, the question is why....did GM purchase some of Delphi as part of the bail out and why then, were hedge funds allowed to make top dollar off of government funds?
To me, there should have been 6 ways to Sunday to get around the hedge funds owning Delphi bonds, yet still build up the auto parts manufacturing GM was after...
I'm still digging around. But the real point of this is, while the UAW and Schultz are spinning this story to pimp for Obama for election 2012...not so fast...
It was team Obama who was involved in the auto bailout, therefore team Obama are the ones who allowed these hedge funds to make out like bandits.
Team Romney wasn't involved.
I don't know for sure if the bankruptcy court through a chapter 11 could have done the same thing, these deals are mega complex, but I do know that private equity swooping up and buying distressed debt and then stickin' it to those companies is vulture capitalism and should be stopped, made illegal in some way.
I don't think in a managed bankruptcy, one "must" have private funds to come out of it. I don't know what that has to do with a Ch. 11 managed bankruptcy (unlike a liquidation). We basically got a managed bankruptcy, so it could be Romney's assertion is true, bottom line large corporate managed bankruptcies are so complex, we're sure not going to answer this one in a comment!
Gez UAW, you took $14/hr for manufacturing work, are you kidding me? Cerberus Capital Management broke even as I understand it from their private equity investment in Chrysler btw, unlike the UAW workers and never mind the salaried ones.
I don't get this spin bogus stuff beyond trying to sway the election. We know, as we wrote at the time, if they didn't save the U.S. auto industry we were going into a depression and I believe there were something like 3 million additional jobs on the line, indirectly.
That said, team Obama did they do this optimally? That's really questionable. Would a managed ch. 11 have been better? Well, shipping pensions to that bankruptcy group is the kiss of death, so right there is a disaster for workers in a Ch. 11 bankruptcy.
I'm going to write up a series of articles some people who have been here, writing about auto bail outs, the financial crisis, trade since 2008 are now writing for people to read. The election narrative is seemingly wiping out history and it's on maximum high noise at the moment. I'd hate to live in Ohio!
Considering the sustained wind speed really wasn't a hurricane when Sandy hit the shore (current estimates are 75 mph sustained, 1 mph above the tropical storm category), it's pretty obvious the Eastern seaboard is woefully unprepared for a natural disaster, major weather event.
The gulf states get 75 mph sustained winds often and never talked about is the Pacific Northwest, where it's guaranteed to have at least one winter storm with 75 mph sustained winds at some point along the coast.
Time matters too, and Sandy "stayed" on top of the area longer than a Pacific Northwest storm typically does.
But bottom line, the death, destruction, gas lines, transit shut down and the biggest, the fact most of NJ is still without power shows the Eastern seaboard's design didn't think about hurricane force winds.
Lord help them if a real hurricane hits, say 110 mph sustained winds over a large area that also stalls out.
At the time this article was written, we were the only site giving a rough estimate if the economic activity losses hit $50 billion. You can assume if they go higher and the longer economic activity is disrupted, plus the more insurance companies screw homeowners and businesses with this phony "new deductible", the more the real losses will increase.
As they come in, I'll put at least in a comment how badly Q4 GDP will be impacted, right now I'd say at least half a percentage point on real Q4 GDP, (that's annualized, as the BEA presents the change in real GDP in the headlines).
The surprise is Atlantic City is up and running again and that is major revenues for the area, business activity, so we'll just have to see.
There is property damage which is one thing and then economic activity, so things like oil shut downs, retail sales, consumer spending, exports being shipped out, imports being shipped in (negative), inventories being added to by businesses, investment purchases... that's the economic activity that is affected in terms of growth.
few realize how large the storm was; even before the storm came ashore at cape may, new jersey, truck traffic was banned from the ohio turnpike and storm warnings went up on lake michigan for 20 foot waves...& at it's peak, the precipitation circulation around the storm extended from nova scotia to wisconsin and from hudson bay to south carolina...portions of NC 12, the highway running the length of the outer banks, were also wiped out...
My impression from the interview on Ed Schultz with the President of the UAW was similar to your concern. The attraction of the hedge funds to Delphi was the money put in by the government. The only way Delphi could raise the price of the parts in a hostage move was to get some of those government funds. That should be the question. Also, as Obama said in one debate, there were no private funds for the GM save in contrast to Romney's assertion that the bankruptcy court would have done the same as Obama. This is a case study that should be larger than the election. First we hope Congress will adjust the tax laws to prevent profit from sending jobs overseas, but the entire system robbing the US of jobs is worth an educated study and do it quickly. We have a generation with a future off-shore as ex-pats.
I saw a post which claimed private payrolls has recovered their jobs lost from the recession. That is false. It is also statistically manipulative to pull out industrial sectors such as construction and manufacturing to make private payrolls "recover".
That statement is also false because it does not take into account increased population and jobs needed for the increased population of working age.
We do our best to not manipulate government statistics, yet shine a light on what's going on and I find such parlor tricks really unethical.
Register for on anonymous comments don't allow links due to spammers and thus people miss your excellent global PMI analysis, click here to read.
I agree, 51%, at 2009 lows vs. 51.7% and crowds cheer (?)< really?
Love to see some analysis on QE and it's real effects. We overviewed a Fed piece which came down to $2.6 trillion for $2 million jobs (this site is called The Economic Populist for a reason!)
But we haven't done much on other macro economic indicators.
We like cross posts and I personally like manufacturing PMI as an indicator. We could use a solid global analysis on what's happening and we especially like seeing where the financial and debt crisis is in Europe or if we see some QE effects on manufacturing. I have noticed prices really seem to be effected.
Great detailed analysis of the inner component's in this month's ISM. A fairly stark contrast to the trends in alternative Markit PMI report for the month, although at 51% and 51.7%, I suppose they're not so different in absolute terms!
The US data this month (with ISM recovering from the summer doldrums, improvements in New Orders and Production components) seems to be a rare bright spot in terms of PMI analysis. Apart from HSBC Chinese PMI making an 8-month high, little coverage seems to have been given to the stalling of the PMI recovery in Europe, and a further deterioration in Japan. Germany, Italy and Spain particularly have bucked previously improving trends, I've covered it in an article here: http://bigmacropicture.blogspot.co.uk/2012/11/global-economy-november-4t...
I suppose an important question is, will we see continued momentum in the recovery of the Chinese and US economies, where monetary policy is starting to filter into business conditions? Can it offset deteriorations in other parts of the world? And how important is the weakening dollar in that equation, given how difficult European and Japanese producers are finding it to compete?
Isn't trying to tie the actions of the trustee, what he invested in and those organizations evil doings (Elliot Management), but how and why hedge funds were allowed to buy junk bonds and gain access to government funds in a managed bankruptcy in the first place?
These companies already had some government funds and the government directed these bankruptcies, so how was this allowed to even happen?
I just re-read Romney's notorious op-ed in the New York Times calling for the auto industry to go bankrupt. The thing is, what he called for, actually happened. Executive management was replaced, the corporate jet was ridiculed, the UAW made major wage, health and retirement benefit concessions and GM, Chrysler, Delphi went into a managed bankruptcy, Ch. 11, in 2005.
In 2011 GM sold part of what they bought from from Delphi to...drum roll please, China, but due to a massive "tax credit" from the state of Michigan, jobs were not offshore outsourced...yet and there are contracts in place.
Delphi's bankruptcy enabled these hedge funds to buy their junk bonds....so how and why did the U.S. Treasury give Delphi TARP funds which is what turned the profits for these hedge funds?
How can the government give U.S. taxpayer funds to a company and not discharge those junk bonds in full?
We know hedge funds are evil and buying up junk bonds, distressed debt is making people super rich by bottom feeding.
That's the real question to be asking here is how and why these hedge funds are allowed to profit in the first place.
The UAW and others are really trying to carpet bomb Romney on this one, claiming the investment in Singer, through a blind trust, was a "donor buy in" for his election campaign. I really don't believe Romney is that dumb frankly.
What is perking up my interest is understanding precisely how these private equity, investor groups were allowed to buy anything when the government had stepped in already.
Right, you notice Bush had no problems expanding government plus giving the Banks trillions through TARP, indirect bail out Federal reserve.
At least they punt and show their political rancor is just that. What horror it would be if one of these people bought into their own B.S. and didn't do what was needed to be done.
I actually thought they were hyping Sandy until maybe 10 hours after it hit and when they said "under water" for Atlantic City plus Staten Island ...
I can see Bloomberg's attitude towards poor people in the NYC response, so much for liberals when the shit storm happens huh?
Anyway, I see the server statistics and it was like a big brown out from the entire Eastern seaboard and now they are showing back up, some.
Grover Norquist needs to be tarred, feathered and run out of town on a rail. Who/what is behind that guy for him to obtain so much power?
We have two candidate selling us snake oil on what it's going to take to really turn this economy around in terms of their "solutions". They describe the problems, yet their solutions aren't gonna cut it and most of them will make things worse.
I'm actually a huge believer in VCs, angel investors, start-ups, new business, but know they simply have to tie all of those potential riches for these types to take the risk, to U.S. citizens, to the workers. Right now, the riches to be had are so often by screwing the workers. I'd say the most consistent thing since 1980 has been labor arbitrage, endorsed, enabled by both parties with a lone few trying to fight the good fight.
I should write up a piece about Elizabeth Warren's accomplishments for the middle class, she's a stand out in this year's candidates.
Bob Kerry is getting crucified in NE for Senate, which is sad and surprising. He's super smart and has a wicked sense of humor to boot. Looks like that state went so red if they ran Jesus as a Democrat he'd lose.
Generally it's like we get 1 here, 1 there in terms of real representation and the rest of this "industry" is simply torturing the American people with ad carpet bombs, showing up at their door and never really presenting plans that actually solve the job and economic hemorrhage out of the nation.
The mantra seems to be "repeat the lie and they will believe it as truth" as our theme for the last 20 years.
Just glad folks are here reading, writing their insights, opinions.
Sandy's both cut off power to millions, but also many people unaffected are simply watching the news or not visiting blogs unrelated to the storm and its aftermath.
Completely off article and thread, but GOP "no big govt." favorite Chris Christie imposed government control of private fuel distribution by imposing rationing via license plate numbers in face of massive fuel shortages. I guess when it really counts and national emergencies hit Americans, elected officials actually do have to make governmental decisions to save and protect lives and property and earn their on-the-record salaries. I agree with the decision, but I can't stand the ridiculous "all govt. sucks, Grover Norquist rules" crap that is useless in a world that actually exists with real people, lives, problems, and solutions. Yeah, govt. sucks, until Grover's car is dented in a car accident or someone steals his wallet filled with corporate donations and then he can't call the public-provided, public servant police soon enough. Or should people look to Grover's doughy ass to look out for us instead of our neighbors, the government, and other people in a commmunity, not just selfish pigs.
/end of off-topic comment
The site regulars and traffic have died down, now back up and I know a huge percentage of our readers are in the DC area as well as NYC area.
I think there are many, many in work world who are extremely intimidated by smart, skilled people, esp. those of the female gender. I think people who are not easily intimidated also scare them.
You're not imagining things, work has become such a "survivor" game people stress and are threatened over terror they will lose their own careers.
Other people have noted this and I've come to the same conclusion. In America (and other countries too), if you have incredible skills, unique backgrounds, etc., then you are a risk to simpleminded folks or those who are truly insecure despite their endless talk otherwise. Vets, contractors from overseas, people that built companies from the ground up or worked in many fields and learned lots of info. and realities about the world are absolutely seen as a threat to managers, HR, CEOs, etc. Of course people have gaps in their resume if they sought more learning opportunities, traveled for jobs, took care of sick relatives, etc. And that's punished. An insecure boss that got his beginning, promotions, and rise to the top through family connections or buddies protecting each other and that never led teams through thick-and-thin, lived in many countries and had to talk to people as equals, not subordinates, will be scared of someone that has, and often at much younger ages and without all the corporate and bureaucratic BS (same with govt. jobs, not just corporations). He sees people that can do those things as a threat. Or an honest person involved in fighting terrorist financing actually getting hired by a bank like HSBC or Well Fargo or Standard Chartered to fight terror financing? Even if some people come from the US Attorney or DOJ or Treasury, if they really cared, wouldn't/shouldn't they quit as soon as they saw their corporation was engaged in such practices? Even if the corrupt or incompetent CEO or boss doesn't see them as a threat to his position, or his friends' positions, he knows by allowing them into the organization at all the skilled/qualified person's background and achievements will be there, every day, in stark contrast to his own. And what can be said when someone that ruins companies and got his job through backstabbing or nepotism is compared to someone that is at a much lower position and has accomplished so much more (without the big ego and big paychecks)? Can you imagine a CEO like Dimon or Blankfein being humble and busting ass out in the field facing life-and-death? On the other hand, could you see the opposite and see someone that accomplished great things for low-pay or what used to be middle class pay and could accomplish so much more at 1/100th the pay current CEO's demand? Of course they could.
But HR puppets, their software, etc. purposely prevent the "poison" that shows them for what they are from ever getting hired. Thus, the best and brightest are purposely locked out, ignored, and viewed as a threat while they are libeled and slandered as those "without the necessary skills." In one sense, sure, many of the unemployed don't have the skills of backstabbing, lying on their resumes, demanding others be fired so that they receive more in compensation, selling out their country for a quick quarterly profit at the expense of our Nation's security and fellow Americans' safety and security and welfare. So in a sense, yes, there is a skills gap. And what skills most banksters and politicians and CEOs and HR reward nowadays are anathema to honest, good Americans.
MSNBC is running all of Obama's "accomplishments". Just because a bill is labeled "financial reform" does not make it so. Giving the Banksters carte blanche is not reforming and saving Wall Street. Passing Obamacare is not passing universal health care (which we need). Spin goes on and on.
The funny thing as people run off to buy this piece of crap or that piece of crap in our anti-Thoreau, consumerism rules all, let's not think but look to puppets on TV to "inform" us society, people literally writing and thinking about the same issues for 2500+ years have dealt with these issues, discussed them, fought over them, etc., etc. Homer, Socrates, Plato, Cicero, writers in the Islamic world, China and the rest of Asia, etc. across the globe in terms and in arguments that should carry weight today in terms that easily exceed our own present "discourse." And that's why history repeats itself, because the people in power purposely ignore history and convince us "this time it's different." Yeah, whatever narcissistic dolts in charge. And yet here we are in 2012 and it's pure regression, like thinking and reading and writing are lost arts! Can you imagine?! And that's why folks in power don't want too many of us reading, writing, thinking, and dissenting but only listening and buying, buying, and buying, whether it's buying their bullsh*t or buying bullsh*t that has a pricetag at a store or online.
On this Election Eve, let's raise our drinks (or tea or other drink, for those that abstain) to true patriotism and dissent and thought, from Tank Man, to Sophie Scholl, to Paine all the way to antiquity whose names are long forgotten but made a difference as best they could, often at the expense of their own safety. Cheers!
What kills me is the spin on the auto bail out. Hopefully EPers know by now I stick to policies, issue specifics and a hell of a lot of statistics, so this is by now means an endorsement. I think it's pretty clear I personally think both parties are corrupt, bought and paid fors...
One thing is clear, media is biased as hell. FOX is a walking Romney advertisement, CNN, MSNBC is a walking Obama advertisement.
Neither channel presents the actual facts.
Sometimes being a gadfly is all a man or woman can do, just ask Socrates.
WRITE-INS are an option, never forget that! Even if it is "none of the above," "banksters win no matter what," "who cares, two sides of same coin," "the 99%," "all politicians are narcissistic psychopaths, who cares," "this system is f*cked," or something else, if you aren't happy with any of the choices, by all means, you don't have to play along. Also, any dissent whatsoever clogs the system up for just one minute more while those wishing to just get along are delayed and might think "why is someone writing in a vote?" And that one moment of thought is enough to convince one person or more, then it's good and noble.
On this election eve, reading Paine's Agrarian Justice and his other works, just think of how far we've fallen. For those that love our Founding Fathers in name only while enriching oligarchs or big bosses of this union or that or this politician's family or that, a little Paine:
"Personal property is the effect of society. . . Separate an individual from society, and give him an island or a continent to possess, and he cannot acquire personal property. . . All accumulation therefore of personal property, beyond what a man's own hands produce, is derived to him by living in society; and he owed, on every principle of justice, of gratitude, and of civilization, a part of that accumulation back again to society from whenve the whole came." Agrarian Justice, 1797.
Carlin:
"The real owners are the big wealthy business interests that control things and make all the important decisions. Forget the politicians, they're an irrelevancy. The politicians are put there to give you the idea that you have freedom of choice. You don't. You have no choice. You have owners. They own you. They own everything. They own all the important land. They own and control the corporations. They've long since bought and paid for the Senate, the Congress, the statehouses, the city halls. They've got the judges in their back pockets. And they own all the big media companies, so that they control just about all of the news and information you hear. They've got you by the balls. They spend billions of dollars every year lobbying lobbying to get what they want. Well, we know what they want; they want more for themselves and less for everybody else."
"But I'll tell you what they don't want. They don't want a population of citizens capable of critical thinking. They don't want well-informed, well-educated people capable of critical thinking. They're not interested in that. That doesn't help them. That's against their interests. They don't want people who are smart enough to sit around the kitchen table and figure out how badly they're getting fucked by a system that threw them overboard 30 fucking years ago.
"You know what they want? Obedient workers people who are just smart enough to run the machines and do the paperwork but just dumb enough to passively accept all these increasingly shittier jobs with the lower pay, the longer hours, reduced benefits, the end of overtime and the vanishing pension that disappears the minute you go to collect it. And, now, they're coming for your Social Security. They want your fucking retirement money. They want it back, so they can give it to their criminal friends on Wall Street. And you know something? They'll get it. They'll get it all, sooner or later, because they own this fucking place. It's a big club, and you ain't in it. You and I are not in the big club."
"This country is finished."
It's unbelievable, groups are asking for volunteers to call people via email, viral videos are planted with 1.5 million hits, as if it means something. Article plants are everywhere.
May I suggest if people are still undecided, take care in what you view out there.
The GOP forced the very non-partisan CRS to pull it's analysis on how personal tax cuts don't create jobs, the main theme of this article.
Fortunately those savvy internets people salvaged the report and it's also overviewed here.
The New Yorker has a pretty good article on private equity firms and makes reference to this practice of dumping pensions onto the PBGC. Robbing pensions by hedge funds is seemingly the one save by team Obama, not clearly "not quite"...to me bottom line this should be made illegal and pension obligations shouldn't be allowed to declare bankruptcy on, plus executive officers should face criminal charges by not fully funding pensions.
Hedge funds did get 33¢ on the dollar, per-negotiated and then 29¢ on the dollar as a deal, but these are junk bonds, so what they bought in at is another question. Hedge funds did make out in the GM bankruptcy.
"Price of parts", I'm not sure what you mean. Most of those "parts" are now coming in as Chinese imports as Delphi was pretty much shipped off to China.
GM bought some of the Delphi and with government funds. But Delphi entered bankruptcy in 2005, long before the auto bail out. Hedge funds already owned the Delphi bonds for they moved in during 2005.
So, the question is why....did GM purchase some of Delphi as part of the bail out and why then, were hedge funds allowed to make top dollar off of government funds?
To me, there should have been 6 ways to Sunday to get around the hedge funds owning Delphi bonds, yet still build up the auto parts manufacturing GM was after...
I'm still digging around. But the real point of this is, while the UAW and Schultz are spinning this story to pimp for Obama for election 2012...not so fast...
It was team Obama who was involved in the auto bailout, therefore team Obama are the ones who allowed these hedge funds to make out like bandits.
Team Romney wasn't involved.
I don't know for sure if the bankruptcy court through a chapter 11 could have done the same thing, these deals are mega complex, but I do know that private equity swooping up and buying distressed debt and then stickin' it to those companies is vulture capitalism and should be stopped, made illegal in some way.
I don't think in a managed bankruptcy, one "must" have private funds to come out of it. I don't know what that has to do with a Ch. 11 managed bankruptcy (unlike a liquidation). We basically got a managed bankruptcy, so it could be Romney's assertion is true, bottom line large corporate managed bankruptcies are so complex, we're sure not going to answer this one in a comment!
Gez UAW, you took $14/hr for manufacturing work, are you kidding me? Cerberus Capital Management broke even as I understand it from their private equity investment in Chrysler btw, unlike the UAW workers and never mind the salaried ones.
I don't get this spin bogus stuff beyond trying to sway the election. We know, as we wrote at the time, if they didn't save the U.S. auto industry we were going into a depression and I believe there were something like 3 million additional jobs on the line, indirectly.
That said, team Obama did they do this optimally? That's really questionable. Would a managed ch. 11 have been better? Well, shipping pensions to that bankruptcy group is the kiss of death, so right there is a disaster for workers in a Ch. 11 bankruptcy.
I'm going to write up a series of articles some people who have been here, writing about auto bail outs, the financial crisis, trade since 2008 are now writing for people to read. The election narrative is seemingly wiping out history and it's on maximum high noise at the moment. I'd hate to live in Ohio!
Considering the sustained wind speed really wasn't a hurricane when Sandy hit the shore (current estimates are 75 mph sustained, 1 mph above the tropical storm category), it's pretty obvious the Eastern seaboard is woefully unprepared for a natural disaster, major weather event.
The gulf states get 75 mph sustained winds often and never talked about is the Pacific Northwest, where it's guaranteed to have at least one winter storm with 75 mph sustained winds at some point along the coast.
Time matters too, and Sandy "stayed" on top of the area longer than a Pacific Northwest storm typically does.
But bottom line, the death, destruction, gas lines, transit shut down and the biggest, the fact most of NJ is still without power shows the Eastern seaboard's design didn't think about hurricane force winds.
Lord help them if a real hurricane hits, say 110 mph sustained winds over a large area that also stalls out.
At the time this article was written, we were the only site giving a rough estimate if the economic activity losses hit $50 billion. You can assume if they go higher and the longer economic activity is disrupted, plus the more insurance companies screw homeowners and businesses with this phony "new deductible", the more the real losses will increase.
As they come in, I'll put at least in a comment how badly Q4 GDP will be impacted, right now I'd say at least half a percentage point on real Q4 GDP, (that's annualized, as the BEA presents the change in real GDP in the headlines).
The surprise is Atlantic City is up and running again and that is major revenues for the area, business activity, so we'll just have to see.
There is property damage which is one thing and then economic activity, so things like oil shut downs, retail sales, consumer spending, exports being shipped out, imports being shipped in (negative), inventories being added to by businesses, investment purchases... that's the economic activity that is affected in terms of growth.
Property losses indirectly affect other things.
few realize how large the storm was; even before the storm came ashore at cape may, new jersey, truck traffic was banned from the ohio turnpike and storm warnings went up on lake michigan for 20 foot waves...& at it's peak, the precipitation circulation around the storm extended from nova scotia to wisconsin and from hudson bay to south carolina...portions of NC 12, the highway running the length of the outer banks, were also wiped out...
My impression from the interview on Ed Schultz with the President of the UAW was similar to your concern. The attraction of the hedge funds to Delphi was the money put in by the government. The only way Delphi could raise the price of the parts in a hostage move was to get some of those government funds. That should be the question. Also, as Obama said in one debate, there were no private funds for the GM save in contrast to Romney's assertion that the bankruptcy court would have done the same as Obama. This is a case study that should be larger than the election. First we hope Congress will adjust the tax laws to prevent profit from sending jobs overseas, but the entire system robbing the US of jobs is worth an educated study and do it quickly. We have a generation with a future off-shore as ex-pats.
I saw a post which claimed private payrolls has recovered their jobs lost from the recession. That is false. It is also statistically manipulative to pull out industrial sectors such as construction and manufacturing to make private payrolls "recover".
That statement is also false because it does not take into account increased population and jobs needed for the increased population of working age.
We do our best to not manipulate government statistics, yet shine a light on what's going on and I find such parlor tricks really unethical.
Register for on anonymous comments don't allow links due to spammers and thus people miss your excellent global PMI analysis, click here to read.
I agree, 51%, at 2009 lows vs. 51.7% and crowds cheer (?)< really?
Love to see some analysis on QE and it's real effects. We overviewed a Fed piece which came down to $2.6 trillion for $2 million jobs (this site is called The Economic Populist for a reason!)
But we haven't done much on other macro economic indicators.
We like cross posts and I personally like manufacturing PMI as an indicator. We could use a solid global analysis on what's happening and we especially like seeing where the financial and debt crisis is in Europe or if we see some QE effects on manufacturing. I have noticed prices really seem to be effected.
Great site you have there!
Hi Robert,
Great detailed analysis of the inner component's in this month's ISM. A fairly stark contrast to the trends in alternative Markit PMI report for the month, although at 51% and 51.7%, I suppose they're not so different in absolute terms!
The US data this month (with ISM recovering from the summer doldrums, improvements in New Orders and Production components) seems to be a rare bright spot in terms of PMI analysis. Apart from HSBC Chinese PMI making an 8-month high, little coverage seems to have been given to the stalling of the PMI recovery in Europe, and a further deterioration in Japan. Germany, Italy and Spain particularly have bucked previously improving trends, I've covered it in an article here: http://bigmacropicture.blogspot.co.uk/2012/11/global-economy-november-4t...
I suppose an important question is, will we see continued momentum in the recovery of the Chinese and US economies, where monetary policy is starting to filter into business conditions? Can it offset deteriorations in other parts of the world? And how important is the weakening dollar in that equation, given how difficult European and Japanese producers are finding it to compete?
Keep up the good work,
Mark A. Rogers
Isn't trying to tie the actions of the trustee, what he invested in and those organizations evil doings (Elliot Management), but how and why hedge funds were allowed to buy junk bonds and gain access to government funds in a managed bankruptcy in the first place?
These companies already had some government funds and the government directed these bankruptcies, so how was this allowed to even happen?
I just re-read Romney's notorious op-ed in the New York Times calling for the auto industry to go bankrupt. The thing is, what he called for, actually happened. Executive management was replaced, the corporate jet was ridiculed, the UAW made major wage, health and retirement benefit concessions and GM, Chrysler, Delphi went into a managed bankruptcy, Ch. 11, in 2005.
In 2011 GM sold part of what they bought from from Delphi to...drum roll please, China, but due to a massive "tax credit" from the state of Michigan, jobs were not offshore outsourced...yet and there are contracts in place.
Delphi's bankruptcy enabled these hedge funds to buy their junk bonds....so how and why did the U.S. Treasury give Delphi TARP funds which is what turned the profits for these hedge funds?
How can the government give U.S. taxpayer funds to a company and not discharge those junk bonds in full?
We know hedge funds are evil and buying up junk bonds, distressed debt is making people super rich by bottom feeding.
That's the real question to be asking here is how and why these hedge funds are allowed to profit in the first place.
The UAW and others are really trying to carpet bomb Romney on this one, claiming the investment in Singer, through a blind trust, was a "donor buy in" for his election campaign. I really don't believe Romney is that dumb frankly.
What is perking up my interest is understanding precisely how these private equity, investor groups were allowed to buy anything when the government had stepped in already.
Right, you notice Bush had no problems expanding government plus giving the Banks trillions through TARP, indirect bail out Federal reserve.
At least they punt and show their political rancor is just that. What horror it would be if one of these people bought into their own B.S. and didn't do what was needed to be done.
I actually thought they were hyping Sandy until maybe 10 hours after it hit and when they said "under water" for Atlantic City plus Staten Island ...
I can see Bloomberg's attitude towards poor people in the NYC response, so much for liberals when the shit storm happens huh?
Anyway, I see the server statistics and it was like a big brown out from the entire Eastern seaboard and now they are showing back up, some.
Grover Norquist needs to be tarred, feathered and run out of town on a rail. Who/what is behind that guy for him to obtain so much power?
We have two candidate selling us snake oil on what it's going to take to really turn this economy around in terms of their "solutions". They describe the problems, yet their solutions aren't gonna cut it and most of them will make things worse.
I'm actually a huge believer in VCs, angel investors, start-ups, new business, but know they simply have to tie all of those potential riches for these types to take the risk, to U.S. citizens, to the workers. Right now, the riches to be had are so often by screwing the workers. I'd say the most consistent thing since 1980 has been labor arbitrage, endorsed, enabled by both parties with a lone few trying to fight the good fight.
I should write up a piece about Elizabeth Warren's accomplishments for the middle class, she's a stand out in this year's candidates.
Bob Kerry is getting crucified in NE for Senate, which is sad and surprising. He's super smart and has a wicked sense of humor to boot. Looks like that state went so red if they ran Jesus as a Democrat he'd lose.
Generally it's like we get 1 here, 1 there in terms of real representation and the rest of this "industry" is simply torturing the American people with ad carpet bombs, showing up at their door and never really presenting plans that actually solve the job and economic hemorrhage out of the nation.
The mantra seems to be "repeat the lie and they will believe it as truth" as our theme for the last 20 years.
Just glad folks are here reading, writing their insights, opinions.
Sandy's both cut off power to millions, but also many people unaffected are simply watching the news or not visiting blogs unrelated to the storm and its aftermath.
Completely off article and thread, but GOP "no big govt." favorite Chris Christie imposed government control of private fuel distribution by imposing rationing via license plate numbers in face of massive fuel shortages. I guess when it really counts and national emergencies hit Americans, elected officials actually do have to make governmental decisions to save and protect lives and property and earn their on-the-record salaries. I agree with the decision, but I can't stand the ridiculous "all govt. sucks, Grover Norquist rules" crap that is useless in a world that actually exists with real people, lives, problems, and solutions. Yeah, govt. sucks, until Grover's car is dented in a car accident or someone steals his wallet filled with corporate donations and then he can't call the public-provided, public servant police soon enough. Or should people look to Grover's doughy ass to look out for us instead of our neighbors, the government, and other people in a commmunity, not just selfish pigs.
/end of off-topic comment
The site regulars and traffic have died down, now back up and I know a huge percentage of our readers are in the DC area as well as NYC area.
I think there are many, many in work world who are extremely intimidated by smart, skilled people, esp. those of the female gender. I think people who are not easily intimidated also scare them.
You're not imagining things, work has become such a "survivor" game people stress and are threatened over terror they will lose their own careers.
Other people have noted this and I've come to the same conclusion. In America (and other countries too), if you have incredible skills, unique backgrounds, etc., then you are a risk to simpleminded folks or those who are truly insecure despite their endless talk otherwise. Vets, contractors from overseas, people that built companies from the ground up or worked in many fields and learned lots of info. and realities about the world are absolutely seen as a threat to managers, HR, CEOs, etc. Of course people have gaps in their resume if they sought more learning opportunities, traveled for jobs, took care of sick relatives, etc. And that's punished. An insecure boss that got his beginning, promotions, and rise to the top through family connections or buddies protecting each other and that never led teams through thick-and-thin, lived in many countries and had to talk to people as equals, not subordinates, will be scared of someone that has, and often at much younger ages and without all the corporate and bureaucratic BS (same with govt. jobs, not just corporations). He sees people that can do those things as a threat. Or an honest person involved in fighting terrorist financing actually getting hired by a bank like HSBC or Well Fargo or Standard Chartered to fight terror financing? Even if some people come from the US Attorney or DOJ or Treasury, if they really cared, wouldn't/shouldn't they quit as soon as they saw their corporation was engaged in such practices? Even if the corrupt or incompetent CEO or boss doesn't see them as a threat to his position, or his friends' positions, he knows by allowing them into the organization at all the skilled/qualified person's background and achievements will be there, every day, in stark contrast to his own. And what can be said when someone that ruins companies and got his job through backstabbing or nepotism is compared to someone that is at a much lower position and has accomplished so much more (without the big ego and big paychecks)? Can you imagine a CEO like Dimon or Blankfein being humble and busting ass out in the field facing life-and-death? On the other hand, could you see the opposite and see someone that accomplished great things for low-pay or what used to be middle class pay and could accomplish so much more at 1/100th the pay current CEO's demand? Of course they could.
But HR puppets, their software, etc. purposely prevent the "poison" that shows them for what they are from ever getting hired. Thus, the best and brightest are purposely locked out, ignored, and viewed as a threat while they are libeled and slandered as those "without the necessary skills." In one sense, sure, many of the unemployed don't have the skills of backstabbing, lying on their resumes, demanding others be fired so that they receive more in compensation, selling out their country for a quick quarterly profit at the expense of our Nation's security and fellow Americans' safety and security and welfare. So in a sense, yes, there is a skills gap. And what skills most banksters and politicians and CEOs and HR reward nowadays are anathema to honest, good Americans.
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