to get me to laugh while reporting on such dismal numbers but those images are outstanding!
New Deal Democrat wrote Silver Lining, which shows the temporary fix before the reality that they are printing money and blasting out the deficit hits.
First, Monday is a good day to write the manufacturing weekly because believe this or not, people read blogs more during the business week and esp. M-TH. Then as far as EP goes it seems more people write on the Weekend, which leaves the week lacking for in depth posts.
To pick up the most readers, assuredly something should be posed M-TH generally.
I keep wondering in this financial crisis where is China? They are now a larger economy than most of Europe and magically they are not on the hook in all of this. Either is India!
That's the common message that GM, big 3 have to "renegotiate" labor costs and have "problems" with pensions, health care costs. I would really like to see that one more in depth because last I heard they had renegotiated new hires to something like $13/hr? For skilled factory work????? I suspect poor management or something else beyond worker costs so maybe you can check out if that is true or not. Always the first thing up is to squeeze workers, never executive management being incompetent.
On McCain/Obama on trade....both are pathetic frankly. Bill Clinton ran the same "oh we need labor and environmental standards" and that's just a canard to pass more corporate lobbyist/Goldman Sachs written bad trade deals that by the clauses are guaranteed to be glorified outsourcing agreements.
McCain is incredible with such a trade deficit trying to promote their version of "free" trade" which is usually biased against the US trade deals.
Did I mention where is China when they are loaded with wealth now on the financial crisis?
On the Fabless deal I just don't know....this is so common but it would seem that AMD should have organized those FABS to make other companies chips on contract.
I think the only (?) FAB coming into the US these days is from a Japan company in Austin. i.e. US companies are not invested in the US and seemingly Japan is investing these days more in the US than so called "American" companies.
Yeah, we wouldn't want to live in an advanced and progressive society like Europe's would we. Imagine giving the rabble health care. What next? jobs?an education?
I can't believe that anything that is good for "the people" will ever deliberately happen in this country. I hope I am wrong and that Obama and the Democratic controlled/heavy Congress will actually do something to change the downward spiral the middle class is on. I won't hold my breadth, but maybe there is a glimmer of hope they will all go berserk and do something worth a paycheck. Really appreciate your essays, mfm. You represent us well.
... and come away as an auto company and a finance company.
If the deal goes through, that's what it would be ... GM swaps the balance of GMAC that it holds to Cerberus, who already holds the controlling interest, and gains Dodge-Chrysler in return.
Other than the Jeep name, market share in the Mexican market and more US Auto Workers to hold hostage for a government bail-out, I cannot imagine what GM thinks they would be getting out of it, but on the other hand, swapping one failing business for another means that they do not have to worry about finally getting their act together in the auto market only to be dragged down by GMAC.
Ralph Gomory and Margeret Blair has been testifying on how to align MNCs with the national (middle class) economic interests. I overviewed their policy recommendations in Corporate Citizen - An Oxymoron
They recently wrote a Huffington Post piece discussing this further and here is one place to start.
It is time for western governments to develop sound national strategies that realign the interests of corporations with the country. A start is the British Companies Act of 2006, which explicitly codifies that directors should consider employees, the community, and many other factors in their decisions. Many US states have passed similar statutes in recent years, but they have had little impact on the actions of corporations.
As BruceMF noted, the trip wires to align the national economic interests and working America's interests are heavily laid and the barrage of MSM responds accordingly when threatened, but maybe the American people can realize there is a better way and start demanding these reforms.
I'm not sure if that means regulate derivatives or keep the ponzi scheme going, or both. Anyone else notice when there is mischief afoot the wording becomes increasingly vague?
1) Another way to achieve a controlling stake is through forcing companies coming to the Fed with hands out to give the government a controlling stake in the country through the dilution of ownership by creating a new class of preferred shares forming 51% of the corporations stock. Give the companies a premium on ownership. Basically, give them an amount equal to the current market capitalization of the companies in exchange for half ownership. So they are getting a 200% premium for the ownership stake, but in the long term the government can make money on it.
2) There are many varieties of works council. Some like the Spanish, are basically local unions with the power to call strikes. Others, like the German have seats on the board of director, and access to internal financial information, (which makes wage negotiations a lot more transparent), but do not have the power to strike.
I like the German model, because it complements union power rather than supplanting it.
should definitely check out the plan that the German government put together to handle the crisis. Highlights:
1. Obligation to keep innovative financial instruments on the balance sheet, and they must be supported with sufficient equity.
2. Bank liquidity cushions must be increased, and a minimum size must be set for them.
3. International standards should be created for greater personal liability for the financial market participants accountable (to prevent golden parachutes).
4. Incentive and remuneration schemes should be adjusted in the financial sector (Steinbrück links those to the insane push for high profit margins).
5. Closer coordination between FSF and IMF.
6. Detrimental short-selling should be temporarily banned by international agreement.
7. A ban on the securitization of 100% of lending risk (to make lenders aware of risk).
8. Enhance cooperation between national regulators.
when I was having a discussion about how people on the coasts can't just write off the Midwest, because it will affect them too.
When I get some time, I want to put together a dataset of the top 100 markets for foreclosures, and compare the hypothesis that the housing price bubble is responsible for high foreclosure rate with a measure of manufacturing job losses in the same period.
Just as first glance, I think that it's likely that what's happening here is at least as much a story of deindustrialization as it is of housing bubbles.
Same reasoning as with financial firms being bailed out ... shifting the balance of financial capitalization from fixed obligations to equity will buy time.
And management and shareholder should share in the haircut, which would follow from ongoing M&A approval rights and suitable limits on executive compensation combined with the normal no common share dividend when the Senior Preferred Share dividend is not paid in full.
Given the target above ... 1/3 capitalist, 1/3 syndicalist, 1/3 socialist ... I think it is an interesting question how close it is possible to get without hitting corporate media tripwires. Senior Preferred shares in return for recapitalization seems to lie on this side of those tripwires.
How do we get employee representation onto the Corporate Board, without the corporate media coming down on it like a tonne of bricks (which is, of course, roughly 1/5 heavier than a ton of bricks).
...a' them smart talkin' suits done dug themselves a hole they cain't git out of....heh...lessen they turn the rest of us into slaves. An that ain't happenin'.
They din't win the Civil War an they ain't a gonna win this one neither. Kin I hear you say, 'Tippacanoe and 1% prime too!'
Are American autos too big to fail? Lord knows Michigan is bearing the brunt of all of this, has for years. Even if they are too big to fail, does anybody care ? Obama has talked a good game on this but what are the odds he means it. We have to make stuff in this country.
Are we looking at the World Bank and the IMF coming in, giving loans to the US/EU, demanding we now "reduce spending on social programs" and "open our doors to foreign investment" by getting these new "loans" to "rebuild our infrastructure" ?????
the final corporate takeover.
I will now go sit in a dark corner and watch CT videos thank you so much!
in the panic of 1873 blog post, speaking of ushering in a new era of corporatism (beyond how bad it already is). I hope we get more analysis on the robber Barron era at this point.
Firstly, let's get over ourselves on conservative vs. liberal on where this RTC structure came from. Reality is it worked and more importantly didn't pull money from taxpayers to get it to work. It also allowed insolvency financial institutions to outright fail, which right now...they seem to be interested in saving certain ones.
SEC. 3. S.E.C. REPORT ON APPLICATION OF ACCOUNTING RULES.
The Securities and Exchange Commission shall report to Congress not later than 180 days after the date of enactment of this Act on the effect of the Commission's clarification on fair value accounting issued September 30, 2008.
So, they did not roll back any accounting methods here on fair marketing accounting. They are simply asking for a report on what the SEC did recently when the SEC, not Congress loosened mark-to-market. Not the same thing as signing up for Enron 2.
There are so many economists saying this solution will work, regardless of political flavorings and that's key here to prevent a cascade.
I'm fairly certain they did not intend this one bill to be the end of, it's simply an alternative to the financial system bail out. That does not preclude a HOLC, does not preclude a reinvestment of infrastructure...and considering DeFazio has proposed these things...it assuredly doesn't preclude that since he's been already pushing for massive infastructure agenda and is fighting the purchase of US public infrastructure by foreign interests and fighting the privatization of it...
So,I think people need to separate out 1 component, one bill versus what these Congress representatives have introduced into legislation, what they advocate for generally and you need to look to the committee chairs...
see how their other bills get buried and are killed off by Pelosi and committee chairs, never allowed to see the light of day or even get brought up for a vote in committee.
This one bill was due to the immediate demand for immediate action on one component and was presented as something to be immediately passed instead of handing over to Paulson $700 billion dollars to add to the ~$800 billion (or more depending on estimates) he already spent trying to help out his financial elite buddies.
On accounting, that is one nasty business and I can see the issue in dealing with sudden nasty market spikes being an issue as well as manipulation of a 3 year average...so let's see what some reports and hearings and the ind. accounting body, experts who are not corrupt and vested have to say. I am by no means an expert in accounting manipulations but my understanding of the reforms in 2002 is that they were half hearted, incomplete and there are still many problems.
This might explain why I feel like I am in a PBS documentary on the Rockefellers, Vanderbuilts and Standard Oil.
The new names are corporate ones, with the lead in the pack being Goldman Sachs.
Very good article and I'm not surprised with the destruction of the new deal and all sorts of regulatory reforms from the Great Depression, we're returning to the 19th century in economic results.
to get me to laugh while reporting on such dismal numbers but those images are outstanding!
New Deal Democrat wrote Silver Lining, which shows the temporary fix before the reality that they are printing money and blasting out the deficit hits.
First, Monday is a good day to write the manufacturing weekly because believe this or not, people read blogs more during the business week and esp. M-TH. Then as far as EP goes it seems more people write on the Weekend, which leaves the week lacking for in depth posts.
To pick up the most readers, assuredly something should be posed M-TH generally.
I keep wondering in this financial crisis where is China? They are now a larger economy than most of Europe and magically they are not on the hook in all of this. Either is India!
That's the common message that GM, big 3 have to "renegotiate" labor costs and have "problems" with pensions, health care costs. I would really like to see that one more in depth because last I heard they had renegotiated new hires to something like $13/hr? For skilled factory work????? I suspect poor management or something else beyond worker costs so maybe you can check out if that is true or not. Always the first thing up is to squeeze workers, never executive management being incompetent.
On McCain/Obama on trade....both are pathetic frankly. Bill Clinton ran the same "oh we need labor and environmental standards" and that's just a canard to pass more corporate lobbyist/Goldman Sachs written bad trade deals that by the clauses are guaranteed to be glorified outsourcing agreements.
McCain is incredible with such a trade deficit trying to promote their version of "free" trade" which is usually biased against the US trade deals.
Did I mention where is China when they are loaded with wealth now on the financial crisis?
On the Fabless deal I just don't know....this is so common but it would seem that AMD should have organized those FABS to make other companies chips on contract.
I think the only (?) FAB coming into the US these days is from a Japan company in Austin. i.e. US companies are not invested in the US and seemingly Japan is investing these days more in the US than so called "American" companies.
End of the American empire ?!
Anything we should worry about, not really.
For most people on earth this could be a very good news indeed.
After all no empire can last forever, there is always an end.
Muhammad
Yeah, we wouldn't want to live in an advanced and progressive society like Europe's would we. Imagine giving the rabble health care. What next? jobs?an education?
I can't believe that anything that is good for "the people" will ever deliberately happen in this country. I hope I am wrong and that Obama and the Democratic controlled/heavy Congress will actually do something to change the downward spiral the middle class is on. I won't hold my breadth, but maybe there is a glimmer of hope they will all go berserk and do something worth a paycheck. Really appreciate your essays, mfm. You represent us well.
... and come away as an auto company and a finance company.
If the deal goes through, that's what it would be ... GM swaps the balance of GMAC that it holds to Cerberus, who already holds the controlling interest, and gains Dodge-Chrysler in return.
Other than the Jeep name, market share in the Mexican market and more US Auto Workers to hold hostage for a government bail-out, I cannot imagine what GM thinks they would be getting out of it, but on the other hand, swapping one failing business for another means that they do not have to worry about finally getting their act together in the auto market only to be dragged down by GMAC.
Financial Sense, which could be tin foil hat, is reporting on global domination wars at the G-7.
Ralph Gomory and Margeret Blair has been testifying on how to align MNCs with the national (middle class) economic interests. I overviewed their policy recommendations in Corporate Citizen - An Oxymoron
They recently wrote a Huffington Post piece discussing this further and here is one place to start.
As BruceMF noted, the trip wires to align the national economic interests and working America's interests are heavily laid and the barrage of MSM responds accordingly when threatened, but maybe the American people can realize there is a better way and start demanding these reforms.
I'm not sure if that means regulate derivatives or keep the ponzi scheme going, or both. Anyone else notice when there is mischief afoot the wording becomes increasingly vague?
perception of "socialism."
2 comments:
1) Another way to achieve a controlling stake is through forcing companies coming to the Fed with hands out to give the government a controlling stake in the country through the dilution of ownership by creating a new class of preferred shares forming 51% of the corporations stock. Give the companies a premium on ownership. Basically, give them an amount equal to the current market capitalization of the companies in exchange for half ownership. So they are getting a 200% premium for the ownership stake, but in the long term the government can make money on it.
2) There are many varieties of works council. Some like the Spanish, are basically local unions with the power to call strikes. Others, like the German have seats on the board of director, and access to internal financial information, (which makes wage negotiations a lot more transparent), but do not have the power to strike.
I like the German model, because it complements union power rather than supplanting it.
What an insightful comment. One can hear the buzzers going off when the people get any voice and power by buzz words.
A Dictionary of the Media buzz word stream and translations are needed.
should definitely check out the plan that the German government put together to handle the crisis. Highlights:
when I was having a discussion about how people on the coasts can't just write off the Midwest, because it will affect them too.
When I get some time, I want to put together a dataset of the top 100 markets for foreclosures, and compare the hypothesis that the housing price bubble is responsible for high foreclosure rate with a measure of manufacturing job losses in the same period.
Just as first glance, I think that it's likely that what's happening here is at least as much a story of deindustrialization as it is of housing bubbles.
Same reasoning as with financial firms being bailed out ... shifting the balance of financial capitalization from fixed obligations to equity will buy time.
And management and shareholder should share in the haircut, which would follow from ongoing M&A approval rights and suitable limits on executive compensation combined with the normal no common share dividend when the Senior Preferred Share dividend is not paid in full.
Given the target above ... 1/3 capitalist, 1/3 syndicalist, 1/3 socialist ... I think it is an interesting question how close it is possible to get without hitting corporate media tripwires. Senior Preferred shares in return for recapitalization seems to lie on this side of those tripwires.
How do we get employee representation onto the Corporate Board, without the corporate media coming down on it like a tonne of bricks (which is, of course, roughly 1/5 heavier than a ton of bricks).
...a' them smart talkin' suits done dug themselves a hole they cain't git out of....heh...lessen they turn the rest of us into slaves. An that ain't happenin'.
They din't win the Civil War an they ain't a gonna win this one neither. Kin I hear you say, 'Tippacanoe and 1% prime too!'
Are American autos too big to fail? Lord knows Michigan is bearing the brunt of all of this, has for years. Even if they are too big to fail, does anybody care ? Obama has talked a good game on this but what are the odds he means it. We have to make stuff in this country.
lots to mull....and you just expressed out loud one of the forbidden thoughts on the possibility of Obama.
Are we looking at the World Bank and the IMF coming in, giving loans to the US/EU, demanding we now "reduce spending on social programs" and "open our doors to foreign investment" by getting these new "loans" to "rebuild our infrastructure" ?????
the final corporate takeover.
I will now go sit in a dark corner and watch CT videos thank you so much!
magic decoder ring: CT - conspiracy theory
in the panic of 1873 blog post, speaking of ushering in a new era of corporatism (beyond how bad it already is). I hope we get more analysis on the robber Barron era at this point.
Firstly, let's get over ourselves on conservative vs. liberal on where this RTC structure came from. Reality is it worked and more importantly didn't pull money from taxpayers to get it to work. It also allowed insolvency financial institutions to outright fail, which right now...they seem to be interested in saving certain ones.
Secondly, from the bill text:
So, they did not roll back any accounting methods here on fair marketing accounting. They are simply asking for a report on what the SEC did recently when the SEC, not Congress loosened mark-to-market. Not the same thing as signing up for Enron 2.
There are so many economists saying this solution will work, regardless of political flavorings and that's key here to prevent a cascade.
I'm fairly certain they did not intend this one bill to be the end of, it's simply an alternative to the financial system bail out. That does not preclude a HOLC, does not preclude a reinvestment of infrastructure...and considering DeFazio has proposed these things...it assuredly doesn't preclude that since he's been already pushing for massive infastructure agenda and is fighting the purchase of US public infrastructure by foreign interests and fighting the privatization of it...
So,I think people need to separate out 1 component, one bill versus what these Congress representatives have introduced into legislation, what they advocate for generally and you need to look to the committee chairs...
see how their other bills get buried and are killed off by Pelosi and committee chairs, never allowed to see the light of day or even get brought up for a vote in committee.
This one bill was due to the immediate demand for immediate action on one component and was presented as something to be immediately passed instead of handing over to Paulson $700 billion dollars to add to the ~$800 billion (or more depending on estimates) he already spent trying to help out his financial elite buddies.
On accounting, that is one nasty business and I can see the issue in dealing with sudden nasty market spikes being an issue as well as manipulation of a 3 year average...so let's see what some reports and hearings and the ind. accounting body, experts who are not corrupt and vested have to say. I am by no means an expert in accounting manipulations but my understanding of the reforms in 2002 is that they were half hearted, incomplete and there are still many problems.
This might explain why I feel like I am in a PBS documentary on the Rockefellers, Vanderbuilts and Standard Oil.
The new names are corporate ones, with the lead in the pack being Goldman Sachs.
Very good article and I'm not surprised with the destruction of the new deal and all sorts of regulatory reforms from the Great Depression, we're returning to the 19th century in economic results.
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