Monday, April 13, 2009

GM told to prep for bankruptcy

There seems to be a prevailing thought process in Washington these days when it comes to how to fix that which is broke.

This being, separate the troubled areas from the profitable. Shuffle some papers and legal status, then create entity A which is solid and will remain in the hands of those who got it into the mess. Plus create entity B, which is little more than a dump for the problem assets, and liabilities which will be financed by taxpayers during disposition of it's assets. Sounds a lot like that privatizing profit, socializing risk that so many are talking about these days.

"A plan under consideration would create a new company that would buy the "good" assets of GM after the carmaker files for bankruptcy, the Times said.

Less desirable assets, including unwanted brands, factories and health care obligations, would be left in the old company, which could be liquidated over several years, according to the paper."

Who says you can't have your cake and eat it too?

WARNING! The above described procedures are not recommend for little Piggies. It could be hazardous to their health and general welfare.

1 comment:

  1. "a dump for the problem assets, and liabilities which will be financed by taxpayers"

    It seems reasonable the auto moguls should get the same fair treatment given to the banking moguls.

    The ink has dried on the first 2000 US infrastructure projects. So far so `good` from government. I continue to see a contraction in the private sector as the public sector increases so I`m thinking this must be the kind of `good` banking deregulation was proposed as.

    From the Cdn far left on banking deregulation during G-7.

    "it’s fine for the States with 9,000 banks"