12-02-2010, 05:03 PM | #1 |
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Ford, Toyota among others GOT bailout money in secret...
http://jalopnik.com/5704575/ford-bmw...vernment-money
In the depths of the financial collapse, the U.S. Federal Reserve pumped $3.3 trillion into keeping credit moving through the economy. It eventually lent $57.9 billion to the auto industry — including $26.8 billion to Ford, Toyota and BMW. The Fed on Wednesday was forced to reveal the identity of the companies it aided during the crisis, after contending to Congress that keeping their identities and the details of such lending secret was essential. Much of Wall Street, and corporate giants such as General Electric, Harley Davidson and McDonald's, took advantage of the Fed's help. We've done the math on how the Fed propped up the auto industry. While Chrysler and General Motors had to go to Congress to beg for cash in 2008, every other automaker's finance arm was having trouble as well. Typically, once they lend money to a buyer, they sell the loan, get the cash upfront, then pump the proceeds back into the business. They also take out short-term loans called commercial paper that keeps the day-to-day business afloat. The crash cut the circuit, raising the chances the automakers couldn't make loans to buyers and keep selling new vehicles. That's where the Fed stepped in. In normal circumstances, the Fed only lends money to banks, leaving the decisions about who should get credit to them. But when the financial markets started to collapse in late 2008, the Fed set up several programs to lend money directly to corporations, a highly unusual step. According to the data, from October 2008 through June 2009 the fed bought $45.1 billion in commercial paper from the credit arms of four automakers - Ford, BMW, Chrysler and Toyota - along with GMAC (the former General Motors credit arm). Of those, Ford sold the most, with $15.9 billion. The Fed also lent $13 billion to investors who bought bonds backed by loans to new car buyers from automakers and banks. The Fed made clear that while investors got the loans, the move was meant to keep the lenders in business; the credit arms of Ford, Chrysler, Nissan, Volkswagen, Honda and Hyundai all benefited directly. According to the Fed, the commercial paper loans have been paid in full, while some $2 billion remains outstanding on loans for bond investors. Ford spokeswoman Christin Baker said the two programs "addressed systemic failure in the credit markets, and that neither program was designed for a particular company, or even a particular industry." Ford Credit had said it was taking part in both programs. BMW told Bloomberg that the Fed lending "supported our financial profile and offered us an additional funding source, especially at times when the money markets and capital markets did not function properly and efficiently." The secrecy surrounding the details of the loans only masked how much aid corporate America and Wall Street needed. While General Motors and Chrysler took the brunt of the blowback for relying on government handouts, the reveal of the Fed numbers show that a far bigger slice of the U.S. auto industry needed help. |
12-02-2010, 05:19 PM | #2 |
Go Blue!!!!!
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Bump, for all the bashers to see.
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12-02-2010, 05:26 PM | #3 |
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Pathetic
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12-02-2010, 05:44 PM | #4 |
Older Than Dirt
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They're all crooks. This is why when private entities fail, the best you can do is put a blanket on the floor so they don't crack their head open too badly.
If you can be in business, it's not any government's repsponsibility to keep you in business. If they didn't do anything, it might sting for a while, but it's a company's own misgivings. This is why I don't support any bailouts to private companies. Where does it end?
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12-02-2010, 05:53 PM | #5 | |
Go Blue!!!!!
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Quote:
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12-02-2010, 06:01 PM | #6 |
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PacMan
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12-02-2010, 06:02 PM | #7 | |
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Quote:
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12-02-2010, 06:05 PM | #8 | |
Go Blue!!!!!
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Quote:
Yep. It would have been devastating. You think it's bad now? It would be off the charts worse had GM and Chrysler gone under. |
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12-02-2010, 06:08 PM | #9 |
Blessed
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OK... I know that we aren't supposed to play favorites as moderators.... and I should probably close this cus it will most likely go south...
When all the "Government Motors" guys see this..... huh what??? what was that noise... BRB.....
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Click image to see build thread. PQ - "the love of cars. It's a boys first step toward manhood and a mans last hold on boyhood." Fbodfather - "We do not want to use the Z28 moniker on a car that does not deserve this hallowed name." The_Blur - "Let's not confuse competitors with equals." |
12-02-2010, 06:11 PM | #10 |
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This if far from the same thing that happened with the GM and Chrysler bail outs. It is no secret that the feds lent money to large companies to keep the credit markets moving. These programs were all about keeping lending moving. I don't know why were trying to pick sides here anyways. We are and still are all to blame to some degree for what is going on today. I for one am Glad that GM, Chrysler, and Ford are still with us and if we had to lend anyone of them money to make it threw these hard times then I say "great". If Toyota didn't have so many american employed I wouldn't be happy about lending them money ,but the fact is they provide a lot american jobs.
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12-02-2010, 06:18 PM | #11 | |
Blessed
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Quote:
This is the Internet... we don't tolerate that here...
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Click image to see build thread. PQ - "the love of cars. It's a boys first step toward manhood and a mans last hold on boyhood." Fbodfather - "We do not want to use the Z28 moniker on a car that does not deserve this hallowed name." The_Blur - "Let's not confuse competitors with equals." |
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12-02-2010, 06:20 PM | #12 |
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12-02-2010, 06:37 PM | #13 | |
Unofficial Glass Tech
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the more we push Congress to pass a bill to audit the Fed, the more we will learn about the abominations of our government... we know it happens every day, but when its shoved in our face like the Wikileaks thing, the more fuel added to the fire... there will be a day that the bailouts, entitlement system, medicare, medicaid, building foreign countries, mantaining our world empire, government programs/departments, and the trillions of wasted money/credit will end...
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12-02-2010, 07:00 PM | #14 |
Go Blue!!!!!
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A coolman siting!!! Hello stranger!!!
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