Too bad; Chrysler used to have a really good engineering team, but that was 30 years ago-
US should threaten to cancel all the auto CDSs.
Judged by a jury of their piers.
Cap 1 disappoints, and now Yahoo. So much for the leak.
------------------
sacrealstats
"they could recover at least 65% of their loans to the company if it is liquidated in bankruptcy"
Grow a sack and call that bluff, Obama.
"The largest Chrysler bank-debt holders are J.P. Morgan, Citigroup, Goldman Sachs Group Inc. and Morgan Stanley. Those four hold about $4.3 billion of the debt, according to people familiar with the matter."
Hehehehehe... The administration will cave in.
More and more I'm starting to wonder if there's a lot of effort going on behind the scenes to hide a looming pension/retirement plan catastrophe caused by bond defaults.
I would understand perhaps the desire to stop an out of control downward spiral, but if the intent is to get re-elected by hiding real losses behind paper manipulation then the real disaster is yet come...
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this is precisely the problem with our new, never ending culture of bailouts
it is absolutely impossible to correctly price a bond because it is impossible to figure out what risks are real and what risks are not
the lenders to Chrysler have no reason to take the offered hit - after all, they made the loans thinking that in bankruptcy, the assets of the firm might pay at least some of the liabilities
now, of course, these lenders have a very complicated calculus - tick the government off (and this same gov't is their backstop, of course) and reject all 'unfair' offers, or take their medicine then ask for more money due to the subsequent loss they will take
if failure is not option, neither is success
Market will probably go parabolic on Capital One and Yahoo news. It just doesn't matter right now. Funny money is king in la-la land.
What I don't understand is why Obama doesn't just force these terms on the banks by threatening to pull way all future bank bailotus. That should do the trick, no? I can't believe people aren't generally more upset that this country is basically being run by a criminal cabal of bankers. Mind boggling.
Broward - thank you for responding.
re: marginal utility of information
The same as marginal utility in economics. Each successive unit of information (however you care to define it) is worth less.
Umm, perhaps it could be better phrased:
"the marginal utility of information decreases with quantity" or just plain "increasing information has diminishing returns"
instead of
"information has marginal utility"
Because "marginal utility" can actually increase with quantity. (numerous examples come to mind)
Driving Chrysler off a pier?
Driving Miss Lazy.
"ell, this fourth piece of information is worth more than the previous three!"
-----------
The infrastructure to deliver the information is not, though.
I'm talking about at a macro-level, society-wise.
No one would create a company specifrically to deliver a piece of information to you alone, although that's the extreme case of price spread over shrinking customer base.
I define "price per unit of information" to be a marketbasket of networking labor, chips, etc. A weighted mix of all the components necessary to extract and deliver a unit of information. Think of in terms of calculus and integrals and derivatives.
More and more I'm starting to wonder if there's a lot of effort going on behind the eto hide a looming pension/retirement plan catastrophe caused by bond defaults.
Pension funds are THE Giant Pool of Money.
Only nine more days for me to go too... I am Chrysler ! ! ! ! WAHHHOO ! ! ! ! !
"s a lot of effort going on behind the scenes to hide a looming pension/retirement plan "
------------
Has to happen.
It's inevitable in one form or another.
Another sterling example of banksters doing the right thing for the society in which they operate. They may get more from Chrysler in bankruptcy - they may not. What is the value of a car factory in the US today? But how much of a loss will they incur from the employees who are paying taxes into TARP, taxes into PIPP, interest on home mortgages, student loans, car loans and credit cards. The banks are in no position to say "NO" to the administration. They need to be taken over and broken into pieces small enough to drown.
Canadian Auto Workers (CAW) indicate they won't accept the 20% wage cuts proposed by Chrysler. Fiat Chairman says no deal without CAW accepting pay cuts. The first lien debt holders may be academic. No Fiat deal = bankruptcy (it you believe the government) I wonder if the stress tests included a Chrysler liquidation.
I can't believe people aren't generally more upset that this country is basically being run by a criminal cabal of bankers. Mind boggling.
People are very upset. They're just not reacting as you might expect.
ac wrote on Tue, 04/21/2009 - 2:27pm.
More and more I'm starting to wonder if there's a lot of effort going on behind the scenes to hide a looming pension/retirement plan catastrophe caused by bond defaults.
Bingo.
Think!!!!!!!! Borrowing from Peter to pay Paul or borrowing from Peter to pay Peter?
I'm doing my brother's online resumes for the job sites.
It's interesting to compare his results (a surprising virgin resume to online) to my own, online for a decade. Too early to be sure yet but it sure looks like jobs are stone dead, regardless of what Feds imply. I'm estimating close to 100 valid resumes per job entry.
"Well, this fourth piece of information is worth more than the previous three!"
-----------
The infrastructure to deliver the information is not, though.
The value of the infrastructure to deliver the information skyrocketed with the news of the hurricane.
Hmmm, 'course the value collapses again after the danger has passed.
In support of your thesis, in my example, the fourth time checking the weather and finding the hurricane forecast, the value went up.
But the fifth (and subsequent) time I check, and find the hurricane still on the way, the value goes down again. So in this case, your thesis is actually intact. Previous information decreased the value of new information.
We can't continue the real recovery if we let Yahoo and Capital One f**k it up. Rally to eternity!
I can't tell you the number of pages I've read for inconsequential proposals....5 pages gets you $2.4 billion.
Not bad.
Friend of mine lost his job in Feb. Found a job which paid more + nice bonus.
It was a pleasant surprise.
@ REBear - what field?
Another sterling example of banksters doing the right thing for the society in which they operate. They may get more from Chrysler in bankruptcy - they may not. What is the value of a car factory in the US today? But how much of a loss will they incur when the employees are laid off and no longber able to pay taxes into TARP, taxes into PIPP, interest on home mortgages, student loans, car loans and credit cards. The banks are in no position to say "NO" to the administration. They need to be taken over and broken into pieces small enough to drown.
When will BO start telling these sorry assed fools to pound sand?
"the vast majority" of banks could be considered well-capitalized.
Uh oh.
Software - C++ NJ
When will BO start telling these sorry fools to pound sand?
Ummm, never?
you know i think Ford is really just holding out until chrysler or gm goes under, and then they'll be able to get whatever they desire from the govt.
Chapter 7
Cheers,
Kilgore Trout
Who remembers when Chrysler was bailed out in the early 80s? I was just a kid, but it was pretty much huge news at the time. Now, it is one rust tin can in a sea of floating debris. Amazing.
If you pound and heated sand, it will turn into glass. I'm looking forward to Glass Bubble during the earlier-than-anticipated mid-year recovery.
COF is down AH but Yahoo is up... Did Yahoo miss or beat? TIA.... 
They may get more from Chrysler in bankruptcy...
The largest holders of debt (JPM, C, MS, GS) are all fully hedged using CDSs (read: AIG), so they have no reason to bend. It's the pension funds that likely are more "naked". The big banks are just reminding the gov't: give us the money now, or later via AIG; we don't really care, we'll get it either way. But force a BK, and you'll have the pension mess to clean up also, so better to not push us.
"Hmmm, 'course the value collapses again after the danger has passed."
------------
Once again, that's a point value, not an aggregation. Society is only willing to allocate a certain level of resources for information generation. That's really what marginal utility is about, what are the alternatives that you could be spending time and effort on. The Internet may not have peaked in India or China but I suspect the "per person time slice" in the U.S. has peaked and declined. The rate of network growth definitely peaked out in 2007, see netcraft for their graph of real host growth.
I am no big Obama fan, but I can see his point of view - after all he has given to the banks, he is just looking for some back. a $6BB haircut on Chrysler bonds is nothing compared to what the government has pumped into these clowns.
Wasn't the amount they are going to get paid for the Keeping Deadbeats in Homes program something like $10BB?
I love it that the banks are playing hardball. Maybe this will force Obama into doing what he should have done all along - cut off the flow of taxpayer money to the banks.
I am not hopeful, but something is gonna have to give.
Banks, Cerberus, Daimler, UAW, U.S. taxpayers, etc.
Good grief! There are so many parties vying for this piece of pie--it's going to be a mud wrestling festival ....
The bondholders may be bluffing, playing chicken. That has been going on now for awhile. It's one reason neither of them met the last deadline.
Stop buying Chinese shit! How's that for a change? I know it's a difficult concept to understand but, How about buying stuff made in the country you live in. If you can't find stuff you like made here, just save your money till something you like comes along. Besides, you got enough Chinese shit already.
If you need some inspiration, check out Walstreetpro2 to get you motivated.
fishing trip canceled its raining pretty hard oh yea happy 4/20
http://www.youtube.com/watch?v=eiBcluzNjLQ&feature=channel_page
Also check out the story about the poisonous Chinese Drywall;
Yet Another Toxic Import from China:Dangerous Drywall
http://www.youtube.com/watch?v=jCxRWi67AuM
---------------------
Chemical con-trails from Air Force spraying operations cause cancer and respiratory problems! Where are all the environmental wackos concerns? See; Killer Chemtrails: The Shocking Truth
http://www.youtube.com/watch?v=Psdg3OAw_a8&fe
A suspected pirate who may be as young as 15 will be tried as an adult, a federal judge has ruled.
Smiling pirate.
http://i2.cdn.turner.com/cnn/2009/CRIME/04/21/alleged.pirate.new.york/t1...
OT: A Limerick for Today
There once was a Secretary named Tim
The Prez had great confidence in him.
So he gave Tim the keys
To the land's treasuries.
A blunder, you say, not a whim?
Now then Tim took the keys with a smile.
And said, wait, I'll be back in a while!
But empty was the vault
Said Tim: "Not my fault!
It was Hank and Ben who were in denial."
So the Prez in the Oval wondering who
Would be left to be blamed - not a clue!
All the men whom he trusted
Will probably be busted.
So his worries by day how they grew.
Now the Prez sits alone in a room
Wondering when China will lower the boom.
Should he soon make the call
To the old guy named Paul
Or just be consumed by his gloom.
Have I come to the end of my tale?
The American economy: EPIC FAIL?
Some see glimmers of hope.
Some see green shoots; some: nope.
I say: put all the bad guys in jail.
More bailouts coming:
http://www.reuters.com/article/marketsNews/idINN2157568420090421?rpc=44
Second lien holders? MI companies? In other words, let's bail out the people who really should have taken the risk in the housing market.
As I have posted before on the MI companies, I think the govt should just let Fannie/Freddie take on mortgage risk over 80LTV anyway. Totally counterintuitive, but the less mortgage credit risk is carved up, the better. At least putting it all at Fannie/Freddie takes one more set of players out of the mix.
Also, taking the pressure off the MI companies and putting them into runoff would help both AIG and Genworth, who both need help anyway.
Slightly related but I put up a short piece about how Japanese wages have been falling for years. I think this was one way that Japanese automakers maintained profitability despite the intense competition in the US. The US automakers didn't get pay cuts through en masse until the credit crisis hit, if I'm not mistaken. It seems to me that once again the US is copying Japan, but it is too late. Given that Japan has no public pension system, the workers there had strong incentive to take the pay cuts rather than lose the jobs. Whereas the US has a pension system, but it is a busted pyramid scheme.
I bought a late model used Chrysler T&C minivan this winter; I don't care if Chrysler liquidates. There will be plenty of third-party parts suppliers and mechanics available. OEM parts and dealer service departments generally aren't worth the premiums charged.
ZackAttack (member) wrote on Tue, 04/21/2009 - 4:26pm.
Grow a sack and call that bluff, Obama.
Agreed 100% with Zach Attack. Shoot the puppy, O. That's what we're paying you for.
Michael,
I keep waiting for it to end, but your ability to self-satirize is fanatical.
please keep informing us in our tragic hours...
REBear wrote on Tue, 04/21/2009 - 4:58pm.
A suspected pirate who may be as young as 15 will be tried as an adult, a federal judge has ruled.
Good thing for the bankers that, like CIA torturers, their caste is beyond prosecution! The heaviest hand of justice possible for the tiniest of fleas. No punishment at all for the great. Isn't this what the rule of law is supposed to prevent?
As to hurricanes, bad example.
Forecasts become more accurate as time goes on, so the quality of info delivered continues
to give value.
Weather is one of the most difficult analyses there is. Way easier to figure out where a distant star will be 1000 years from now.
But hurricanes predictions 5 days out are now what they were 3 days out. There really is improvement.
lawyerliz
@Janosik -
You're only saying that because you sniffed too many Chem-trails.
Every blog site there's a resident comedian and a mascot.
For the life of me I can't figure out which is Michael.
ac wrote on Tue, 04/21/2009 - 3:27pm.
More and more I'm starting to wonder if there's a lot of effort going on behind the scenes to hide a looming pension/retirement plan catastrophe caused by bond defaults.
I would understand perhaps the desire to stop an out of control downward spiral, but if the intent is to get re-elected by hiding real losses behind paper manipulation then the real disaster is yet come...
Yes, that's the game. I recall many months ago, perhaps in the earliest days of TARP, Bernanke was making opening statements before testimony to Congress and slipped away from his written version to say that we need to give the American people confidence in their retirement savings.
Liked the Limrick, Cheelah.
lawyerliz
I'll keep it coming as long as it takes to wake everybody up. Not too many dummies on this board so I think many will eventually get it. Besides, I know you enjoy it.
---------------------
Chemical con-trails from Air Force spraying operations cause cancer and respiratory problems! Where are all the environmental wackos concerns? See; Killer Chemtrails: The Shocking Truth
http://www.youtube.com/watch?v=Psdg3OAw_a8&fe
ghostfaceinvestah (member) wrote on Tue, 04/21/2009 - 4:01pm.
More bailouts coming:
http://www.reuters.com/article/marketsNews/idINN2157568420090421?rpc=44
The official said the Treasury Department is also considering ways it could resolve problems in the mortgage insurance industry battered by mounting foreclosure losses.
"We are aware of the difficulties in the industry and we are analyzing different options to deal with" those difficulties, the official said.
Sweet! MILF is here at last!
MLM,
Poor Michael's only now feeling his first genuine pains of disillusionment.
It's a long way down from that throne, and he'll need to pass a few orders of magnitude along the way.
As a first step Michael, I would suggest you accept your complete and total powerlessness and insignificance.
What do you know about chemical Con-trails MLM? Please enlighten us.
---------------------
Chemical con-trails from Air Force spraying operations cause cancer and respiratory problems! Where are all the environmental wackos concerns? See; Killer Chemtrails: The Shocking Truth
http://www.youtube.com/watch?v=Psdg3OAw_a8&fe
MLM,
One of my favorite songs;
Coldplay - Viva La Vida
http://www.youtube.com/watch?v=dvgZkm1xWPE&feature=related
---------------------
Chemical con-trails from Air Force spraying operations cause cancer and respiratory problems! Where are all the environmental wackos concerns? See; Killer Chemtrails: The Shocking Truth
http://www.youtube.com/watch?v=Psdg3OAw_a8&fe
"ZackAttack (member) wrote on Tue, 04/21/2009 - 4:26pm.
Grow a sack and call that bluff, Obama."
That's we we voted for you Obama....stand up to these thieves. Or, say goodbye to your political capital.
There will be a last minute slime ball deal that the UAW and retirees will be spared. Maybe part of Chrysler ends up merging with GM. Obama is owned by the UAW. Obama has control of these banks and they will dance the final number he wants and fill their piggy bank behind the scene.
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Must be why they started charging to kick the tires at the Crhysler dealerships that are still open.
Nostrovia,
"capital one reported a net loss of $111.9 million, or 45 cents a share, for the first quarter. A year ago, the financial services company posted a profit of $548.5 million, or $1.47 a share."
shares down 10% instantly after hours. gave up all the days gains.
http://www.google.com/finance?client=ob&q=NYSE:COF
\\\\\\\\\\\\\\\\\\\|||||||||||||||||||///////////////////
Misean - LOL ! good one! 
Cancelling a CDS seems to me rather extreme. I suggest instead that any entity that has issued CDS on GM or Chrysler that is also receiving government support be allowed to
go into BK before paying off on such CDS.
-------
Rosebud Junk Co
NO worry, before GW left they took the Pension Trust Fund and gave it to WS were I'm sure it's lost all value.
The race to the bottom continues.
jo6pac
Lawyerliz: Thanks!
Credit card chargeoffs contained, to COF, right ?
I'd call the bondholders bluff on that 65% valuation.. aka. BULLS#!T Unless they missed a decimal there.. "oh that's not 65% that's 0.65% !"
-splat
Touzet is the last name of a guy who did not so good mtg things to a client of mine.
In Miami. Don't know if it is the same person of course.
lawyerliz
My prediction: Obama folds on this like a cheap tent.
Make Fiat pay for the established dealer network they want to use to sell their cars in the US.
Isn't the Government now the biggest shareholder of the banks now?
Isn't that just another scheme to transfer tax payer dollars to the bankers?
just how easy is it to game this?
i mean the treasury is backstopping the banks...geez whattaya think?
uhmmm, okay, let's see, if you give me zero for my loans, well you will have to double-ppip me.
what a crock.
test
shoppingaround
Geither says the banks have enough capital, so the markets rebound. Tomorrow there will be bad news and it will go down. Then up. Then down. etc. etc. ad nauseum.
Personally, I am in the deflation camp.
http://www.nytimes.com/2009/04/21/business/global/21deflate.html?_r=2&hp