Saturday, January 14, 2012
When you tie in some of his recent investments (Bank of America--probably the weakest of the national banks today) and his estate planning (giving away a large portion of his estate to charities), it has to make someone wonder.
What have you heard? Are we babbling or could there something here? Let us know.
Meanwhile, read the following article and see how out of touch he seems to be.
When the history of this time in American History is written, it will be shown to be one where government officials were able to convince the public that there was an emergency and that we did not have time to even think of the ramifications of the actions they were taking. Whether it was the mortgage crisis, the debt crisis, the debt limit crisis or the failure of GM and Chrysler, no one took a calm, reasoned approach to any of these problems.
Yes, they were problems, however, we do not think they were ones that would have crashed the economy or ended the automobile business in this country. In retrospect, some banks might have failed but that is what should happen when irresponsible business people make bad decisions. Other banks would have stepped into the fold and picked up the pieces.
On the other hand, had "the bright people" not warned that without government intervention, the whole system would collapse, other solutions could have been created to solve the issue. For example, when the Savings and Loans got in trouble in the 80's, the government took over the bad loans and did a work out, off the books of the S&Ls. Why would that not have worked? Or the government could have taken the bad loans, put them in a fund to work them out, given the banks 20% on the dollar for those instruments. The banks would have been free from the junk and could proceed on with their daily business.
The same goes for the car companies. If one or both had to declare bankruptcy, there would have been a restructuring of the company (option 1) or it would have gone out of business (option 2.) Had the courts or the company selected option 2, there would have been other companies both foreign and domestic who would have picked up the plants and some of the employees. It would not have ended the car business here. That was a scare tactic.
Instead, the government in its wisdom(???), chose to violate centuries of bankruptcy law and gave precedence to the unsecured unions over other secured creditors. Why? One can only assume it was a payback to union bosses.
Additionally, independent dealers had their agreements with the manufacturers cancelled, or should we say, confiscated. To this day, no one had been able to convince us that this was a necessary step to save the companies. Dealers are independent business people deriving their income from the sale of cars. The companies sell the cars to the dealers who retail them to the public. The only other financial tie is warranty repairs for which the dealer is reimbursed by the company.
Additionally, eliminating dealers drives up the cost to the public as there is less competition. In fact, in many rural areas, the dealers were eliminated causing the public to drive to the larger cities to make their purchases.
We see no reason, financially, for the car dealers being eliminated. Yet, politically there was a reward. Most dealers are independent and therefore many are Republican and they gave contributions to the party. So when the opportunity arose to eliminate a strong group of contributors, the Obama Administration jumped at the chance. When an analysis of those dealers who were forced to close, it was found that the vast majority had given contributions to the Republican party. It did not matter how many cars they sold, their performance scores or their customer satisfaction (all of which were reasons the Administration professed to be using), if they gave to Republican campaigns they were forced out of business.
Now we read the White House is proposing new ways to get people out of their mortgages. In the following article we see the next bribe of the day done by this Chavez- like Administration. Will the we see another decade as a free people?
This is not the way we do business in this country. The abuse of power shown by this Administration regarding the banks and the cars companies and the recent appointments which made even though the Senate is still in session is nearing dictatorial levels. It must not be allowed to continue past January 2013!
Tell us what you think.