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Originally Posted by rgrizzard
Dragoneye you said self-help with loans???? How do you have self-help with a loan from somebody else?
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"Self help", the way I meant it, means that they are capable of doing nearly everything that would be done in bankruptcy court by themselves. either way would require some form of loans. By doing it on their own -- they eliminate all the unnecessary risks associated with a Chapter 11 filing,
exponentially increased because of GM's sheer size. Read the viability plans. I'm not making this stuff up.
Quote:
Originally Posted by rgrizzard
You also talk about how they've been restructuring for a while. Well if it's not working why would you continue loans to them without control over them, not very good financing 101.
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First of all, I would argue it WAS working. See the new products? See the reduction of waranty recalls in HALF in the past couple years? The reduction of operating costs, number of dealerships, hourly wages, hourly AND salaried benefits? It's all evidence of a sucessful restructuring up until 2007. They should have broke even last year, and made a profit this year...assuming market conditions stayed the same as they were in 2006/2007.
Despite that, you don't fix a company of this size and caliber, nor it's problems, overnight. Especially not when the night keeps getting darker and darker....All the above took half a decade to complete.
As far as 'continuing' loans...the US government didn't give them the money they asked for. The correct amount of money they spent two weeks calculating. Instead, they gave them what they asked for through March. This was part of an agreement that stated if they could prove by March 31st, that they were
on the path to good health, then they would get more money. In short, they were MEANT to get more money. This shouldn't be a surprise....
