Grim Local News – GM, Chrysler seek more money and will cut more jobs…

Kind of a depressing local story for me:

Video:

The Story:

Billions of dollars in government loans to prop up General Motors and Chrysler won’t be enough. The companies, which have received $17.4 billion so far, filed plans with the government more than doubling that request to a staggering total of $39 billion.
The requests, made in government-required restructuring plans filed Tuesday, were accompanied by plans for thousands more job cuts, slashing of models and brands, union concessions and the prospect of even further expense cuts.
In a dramatic acknowledgment that conditions in the U.S. auto industry have grown significantly worse in just two months, GM alone said it would cut 47,000 jobs globally by the end of the year — 19 percent of its work force. It also said it would close five more U.S. factories, although it did not identify them.
Chrysler said it will cut 3,000 more jobs and stop producing three vehicle models.
The grim reports came as the United Auto Workers union said it had reached a tentative agreement with GM, Chrysler and Ford Motor Co. on contract changes. Concessions with the union and debt-holders were a condition of the government bailout.
GM said it could need up to $30 billion from the Treasury Department, up from a previous estimate of $18 billion. That includes $13.4 billion the company has already received. The world’s largest automaker said it could run out of money by March without new funds and needs $2 billion next month and another $2.6 billion in April.
“We have a lot of work to do,” General Motors Corp. Chairman and Chief Executive Rick Wagoner said. “We’re still going at this with a great sense of urgency.”
via The Associated Press: GM, Chrysler seek billions more, to cut more jobs.

I think I’ll just refrain from public commentary on this one. There’s family, my family involved here; so, I’m totally biased. I just do not think those Conservatives who opposed this money to these companies really get it. All I am going to say. Anyone that’s read this Blog, or wants to know what I think. Do a search on “Tarp Loans” and you’ll see why I feel the way that I do.

The Washington Post Promotes Communism

They’re not even trying to hide it anymore.

Via the Washington Post:

The U.S. banking system is close to being insolvent, and unless we want to become like Japan in the 1990s — or the United States in the 1930s — the only way to save it is nationalization.
As free-market economists teaching at a business school in the heart of the world’s financial capital, we feel downright blasphemous proposing an all-out government takeover of the banking system. But the U.S. financial system has reached such a dangerous tipping point that little choice remains. And while Treasury Secretary Timothy Geithner’s recent plan to save it has many of the right elements, it’s basically too late.
The subprime mortgage mess alone does not force our hand; the $1.2 trillion it involves is just the beginning of the problem. Another $7 trillion — including commercial real estate loans, consumer credit-card debt and high-yield bonds and leveraged loans — is at risk of losing much of its value. Then there are trillions more in high-grade corporate bonds and loans and jumbo prime mortgages, whose worth will also drop precipitously as the recession deepens and more firms and households default on their loans and mortgages.
Last year we predicted that losses by U.S. financial institutions would hit $1 trillion and possibly go as high as $2 trillion. We were accused of exaggerating. But since then, write-downs by U.S. banks have passed the $1 trillion mark, and now institutions such as the International Monetary Fund and Goldman Sachs predict losses of more than $2 trillion.
But if you think that $2 trillion is high, consider our latest estimates at RGE Monitor, the financial Web site we run: They suggest that total losses on loans made by U.S. banks and the fall in the market value of the assets they are holding will reach about $3.6 trillion. The U.S. banking sector is exposed to half of that figure, or $1.8 trillion. Even with the original federal bailout funds from last fall, the capital backing the banks’ assets was only $1.4 trillion, leaving the U.S. banking system about $400 billion in the hole.

Nationalization is Federal Ownership of a private industry; which is what Communist Russia did during the soviet era. It is Communism. This is the agenda of the Liberal left, the Federal ownership of the banking system. It also sets the United States up for the Biblical Mark of the Beast.

We are living in dangerous times.

From the Bible:

And I stood upon the sand of the sea, and saw a beast rise up out of the sea, having seven heads and ten horns, and upon his horns ten crowns, and upon his heads the name of blasphemy. And the beast which I saw was like unto a leopard, and his feet were as the feet of a bear, and his mouth as the mouth of a lion: and the dragon gave him his power, and his seat, and great authority. And I saw one of his heads as it were wounded to death; and his deadly wound was healed: and all the world wondered after the beast. And they worshipped the dragon which gave power unto the beast: and they worshipped the beast, saying, Who is like unto the beast? who is able to make war with him? And there was given unto him a mouth speaking great things and blasphemies; and power was given unto him to continue forty and two months. And he opened his mouth in blasphemy against God, to blaspheme his name, and his tabernacle, and them that dwell in heaven. And it was given unto him to make war with the saints, and to overcome them: and power was given him over all kindreds, and tongues, and nations. And all that dwell upon the earth shall worship him, whose names are not written in the book of life of the Lamb slain from the foundation of the world. If any man have an ear, let him hear. He that leadeth into captivity shall go into captivity: he that killeth with the sword must be killed with the sword. Here is the patience and the faith of the saints. And I beheld another beast coming up out of the earth; and he had two horns like a lamb, and he spake as a dragon. And he exerciseth all the power of the first beast before him, and causeth the earth and them which dwell therein to worship the first beast, whose deadly wound was healed. And he doeth great wonders, so that he maketh fire come down from heaven on the earth in the sight of men, And deceiveth them that dwell on the earth by the means of those miracles which he had power to do in the sight of the beast; saying to them that dwell on the earth, that they should make an image to the beast, which had the wound by a sword, and did live. And he had power to give life unto the image of the beast, that the image of the beast should both speak, and cause that as many as would not worship the image of the beast should be killed. And he causeth all, both small and great, rich and poor, free and bond, to receive a mark in their right hand, or in their foreheads: And that no man might buy or sell, save he that had the mark, or the name of the beast, or the number of his name. Here is wisdom. Let him that hath understanding count the number of the beast: for it is the number of a man; and his number is Six hundred threescore and six. (Revelation 13:1-18 KJV)

Others: The Corner, Vox Popoli

Red State Update on Obama's Stimulus News Conference

Jackie and Dunlap on Obama’s first prime-time news conference. Stimulus pimpin’ and Elkhart bashin’ ensue.

Communist Leader says "Obama working to nationalize U.S. economy"

Just as I suspected….:

President Obama is “considering” a radical agenda to nationalize the U.S. financial system, the Federal Reserve Bank, and private industries such as energy and other sectors whose future is “problematic” in private hands, claims the leader of the Communist Party USA.
In a major speech focused on Obama titled “Off and running: Opportunity of a lifetime,” CPUSA leader Sam Webb also alleges Obama’s administration is considering turning education, childcare, and health care into “no profit zones;” rerouting investment capital from military infrastructure
to “green economy” projects and public infrastructure; and waging a “full scale” assault on global warming.
“We now have not simply a friend, but a people’s advocate in the White House,” declared Webb at a recent speech in Ohio for People’s Weekly World Communist newspaper.
“An era of progressive change is within reach, no longer an idle dream. Just look at the new lay of the land: a friend of labor and its allies sits in the White House,” Webb proclaimed.
via Communist: Obama working to nationalize U.S. economy — WorldNetDaily.com.

You can bet your sweet royal behind that if this “economic stimulus” fails, the doors will be opened to nationalization of our Banks, Businesses, Oil companies and everything else eventually. We as Americans must stand up and fight against this sort of tyranny!

Breaking Local News – G.M. to offer buyout packages to all union employees.

This is interesting…:

General Motors Corp. will offer buyouts to all of its hourly employees, a spokesman confirmed Tuesday, as the troubled automaker continues to slash costs.
GM spokesman Tony Sapienza said the buyouts will mainly target GM’s 22,000 retirement-eligible hourly employees, though any union employee can take the offer.
News of the buyouts first broke on Monday. A union official told The Associated Press then that GM would offer $20,000 in cash and a $25,000 car voucher for workers who retire early and those who simply leave the company. The official spoke on condition of anonymity because workers were not yet notified of the packages.
via GM To Offer Buyouts To All Hourly Employees — WDIV Detroit.

Just another sign of the times. For the record, G.M. has done this in the past, when times were bad. Hopefully some of the guys that have been with the company and are about ready to retire will take this buy out. Hopefully, this will help the problem and G.M. will become viable.

Should we give incentive bonuses to Wall Street Watchdogs?

I have fixed feelings about this, and I will explain why a little further down.

An Article in the New York Times Dealbook Column asks a question whether Wall Street Regulators or Watchdogs should get performance bonuses.

Maybe someone deserves a bonus.
Like someone who sniffs out the next Bernie Madoff. Or jousts with tomorrow’s gonzo bankers. Or defuses the Next Big Crisis in whatever Next Big Thing is dreamed up by Wall Street.
Someone, in short, who regulates.
It is clear that the nation’s financial regulators were no match for Wall Street last time. The financiers were always one step ahead. But maybe that isn’t surprising. The financiers, after all, have a big incentive to outsmart the financial police. It is called a bonus. Wall Street lures a lot of bright minds with money. How can federal agencies compete? They can’t.

So, of course, The Government of Singapore’s head honcho says we ought to incentivize watchdog process.

Tony Tan Keng Yam, deputy chairman and executive director of the Government of Singapore Investment Corporation, suggested that one reason American regulators fell down on the job was that they were paid too little.
“You must have as good people working in the government in the regulatory authorities as those that are working in the private sector,” Mr. Tan said. “You do need, particularly in these very difficult times, capable people in central banks, in government, in the Treasury who can effectively supervise.”
Mr. Tan knows about this firsthand. He is a former regulator himself, and Singapore has a different view about compensation.
“We pay our politicians and our government servants very well,” he said. “We lock remuneration to the market.”
While Singapore’s watchdogs aren’t paid enough to afford private planes, some in top positions make seven-figure salaries.

At first blush, this would seem to be a great idea; however, if you think about it closely, this would not be such a good idea. Because of the following:

Some at Davos thought the bonus idea could work. But anxiety over that approach was palpable. “They already treat us like criminals,” one hedge fund manager said.
A few said giving bonuses to regulators would be like giving bonuses to the police for issuing speeding tickets. Maybe the regulators, like Wall Streeters, would start thinking about the money, rather than what is right. But maybe that’s exactly what Wall Street needs to slow down.

I must say, that I highly disagree with this idea. Why? While I believe that moderate regulation is a good idea on Wall Street; I believe that incentivizing the Wall Street watchdog process will result in a overzealous regulatory process, that will be solely based upon monitory compensation. This would be absolutely disastrous to the free market process in America. As well all know we already law enforcement that borderlines upon a police state. Doing this to Wall Street would cause a fear mentality amongst the financial sector and discourage investment.

We need regulation, not a financial police state.

The Story of John Birch

Here is a very excellent video on the life of John Birch:

This video is by the founder of the John Birch Society, Robert Welch explaining what the John Birch Society is about:

The Mining Industry feels the pinch

It is not just the auto industry that is feeling the pinch of the economy, it seems that the mining industry is feeling it as well.

BIG mining companies have suffered an astounding reversal of fortunes in the past few months. As boom has turned to gloom, commodity prices have slumped, leaving mining firms with painful decisions to make. Rio Tinto is the latest to suffer. On Monday February 2nd the Anglo-Australian mining giant was forced to confirm press speculation, acknowledging that it is in talks with Chinalco, a state-owned Chinese aluminium maker. The Chinese firm may agree to a deal to help to alleviate Rio’s debts which were taken on before the credit crunch led to a foundering world economy.
Rio’s debt pile of some $40 billion was mostly run-up through its purchase of Alcan, a Canadian aluminium firm, in 2007. Around $9 billion is due later this year, and refinancing will be a tricky proposition given the parlous state of debt markets. Another $10 billion must be repaid in 2010. Rio has started a firesale of assets: it raised $1.6 billion last week by selling iron ore and potash businesses in Brazil and Argentina to Vale, a Brazilian rival. But prices are depressed and making a sale is not always possible—Rio has still not managed to offload Alcan’s packaging business, although it is reportedly in talks with a potential buyer.
via Rio Tinto, deeply indebted, seeks investment from China The Economist.

More fall out from a concept floated by the Democrats, that was based entirely upon risk. Thank you Bill Cinton for ruining America. 🙄

Japan's Economy on the verge of collapse as well.

Russia is not the only one. Japan now is on the verge of collapse as well.

A reader chided me for not making note of the truly dreadful factory output figures released last Thursday, which showed a fall of 9.6%.
I have to confess that I have fallen into “Japan bad news” syndrome, in that I expect bad news out of Japan and therefore did not focus enough on the details. And while I do not aspire to covering every financial news story (that’s what the MSM is for), the latest figures paint a grim picture, even by our new, desensitized standards.
It wasn’t simply that December was truly awful, but it came on top of a nearly-as-bad November
via naked capitalism: Veneroso: Japan on the Edge of the Abyss.

Again, this is what happens when you inflate a money supply and create a bubble.

Yves continues:

Yves here. I only get the privilege of reading Veneroso now and again, but I cannot recall him taking a tone remotely like what follows:

I have been writing about an Asian black hole for almost two months now. I have been crying from the rooftops about an emerging depression in Japan. It has been as though a neutron bomb had gone off in the world. There was no one who seemed to notice, no one who seemed to listen.
Every week it gets worse and worse and worse. Today it was Japan….
THERE HAS NEVER BEEN DATA THIS BAD FOR ANY MAJOR ECONOMY – EVEN IN THE GREAT DEPRESSION. December industrial production came in down 9.6%, worse than the METI forecast. It is now down almost 21% year over year. METI forecasts a further 4.7% decline in February. The inventory to production ratio soared again. Maybe METI will be correct.
If it is, Japan industrial production will have fallen 28% (non annualized) in four months. It will have fallen by a third in about a year. Nothing in the history of major nations compares. A 28% decline in four months would be more than half of the entire decline in U.S. industrial production over the 3 years and nine months of the U.S. Great Depression.
It would be a greater decline in four months than in any 12 month period in the Great Depression in the U.S. We are literally looking at the unimaginable. (I am attaching the U.S. industrial production index from the Great Depression for comparison).
IT’S A DEPRESSION IN JAPAN – ALREADY – PURE AND SIMPLE.

If this is true, unless President Obama can pull some sort of a miracle out of his rather skinny ass. We are in deep trouble. The reason I say this is because we are in a Globalist Economy, whether we like it or not, and Japan’s failures are our failures as well.

I think it will get much worse, before it gets any better. 🙁

(Via Freedom’s Phoenix)

Zo Breaks it down on "The Dream and the 44th"

Zo’s Website