Well apparently a balance to Michael Moore - lets go and see it in the fall. Government spending at its best - the cloak is lifted. Vote out the incumbents everywhere!
Showing posts with label Bail Out. Show all posts
Showing posts with label Bail Out. Show all posts
Tuesday, August 31, 2010
Monday, August 30, 2010
Visited My Favorite Chevy er Chevrolet Dealer Today
I've been gone from the area for two months with health problems and just got around to visiting my Chevy, lest we forget the 'New' General Motors issued a directive that they are not 'Chevy's' the are now Chevrolet; but anyway it is a moot point for me, she is no longer a Chevy Dealer.
Here we sit in a town of 6,000 and our dealership who is a second generation dealer is now in the used car business and happy. You see when the vaunted government task force took over our auto industry you all remember all the closings going on. Not for any particular reason other than the Task Force said it 'would save money'. What they didn't understand is that the dealers were Sales dealers and created sales, not expense.
You see they couldn't get away with closing my dealer because she is a woman number one, and she is Native American number two ... but of course they couldn't do it with a frontal assault to they found other ways to drive a long time dealer out of the market. There next ploy was to 'require' (they're doing it all over the nation) the dealers remaining to in her case build a completely new building and shop. A cost to her of about $3 million. In this economy?
So they got what they wanted - she sold it to another dealer locally who handles Chrysler (the bullets been fired there just not dead yet) and he is building the building. But my friend told me it was such a relief to be out from under GM's heavy hand that she couldn't be happier.
Her and her partners have morphed their business into a mini-CarMax of sorts. They are creative and resourceful about finding good quality used cars at the price point of our local market and they cut inventory, which GM wouldn't let them do and things are better for them.
And I learned a few things about GM dealership 'franchising' as they loosely call it. She pointed out to her sign out front, a single GM dealership sign and said, "I no longer have to pay GM $3,000 a month for the 'lease' on that sign. She told me earlier about GM requiring Starbucks carts in every showroom - a mere $5,000 charge. And then there are the computer systems required by GM that comes with thousands of dollars in costs.
I said, "You know McDonald's and the like only charges probably 7% to 10% franchise fee. She said, "Well, we figured up all our GM costs just for the 'privilege' of being a GM Dealer and it comes to over 30%?" Unbelievable! It is sad but I am now happy for them that they are out from under the company with no leadership.
When it comes to investing in that new GM that the CEO is bragging has paid the government back when they really haven't (that's another story), think twice, long term they aren't in a position to win ... blu, blub, blub.
Monday, May 17, 2010
New Government Spending - A Really Good One
Do you think the networks, pundits and experts know why we vote? Hardly. Yet over $240,000 of our 'stimulus' dollars went to the University of California to study the vote choice in sub-Saharan Africa through extensive analysis of exit poll data. The project promises that these efforts will result in a robust understanding of how Africans vote, which in turn allow for better targeting of our external aid funds aimed at promoting democracy on the continent. And ... it created zero jobs.
But perhaps it will allow us to better manipulate others elections? Incredible!
Saturday, May 15, 2010
On Top of our Spending While Talking Cuts
Obamanation continues to deplete the coffers of this country at a record pace. Our deficits are staggering and he just keeps pumping it out. And look at another example of our spending. An outfit called Deployment Essentials LLC based in Florida was able to get their hands on $1.47 million of stimulus funds through the Federal Communications Commission.
What for you ask? It is to help the poor folks of LA, NYC and Dallas install digital TV converter boxes. So far they have used 67 temporary employees (think cheap labor, no benefits or rights) to convert 5,113 technically challenged people. They referred another 1,023 to the TV help line.
Think about it? The government made us change to DTV's, even pays for the converter boxes and with this grant then pays companies to show people how they work .... ummm?
And you guessed it, zero permanent jobs created. The stuff you hear from DC on all these new jobs ... look around and ask your friends and neighbors if they have one? The stimulus package was nothing more than a lottery for the well connected. And our debt soars.
Friday, May 14, 2010
More Jobs from our Stimulus Dollars ... Not Really
The University of Washington received nearly $400,000 of stimulus money to study the reproduction of various yellow monkey-flowers. It created exactly zero, nada, no jobs. Do you really think our leaders understand there is a financial crisis in this country or are we being led in a totally different direction? We need to keep both eyes on this group.
Wednesday, May 12, 2010
I'm Sure the Government Can
That was a pretty catchy song the guy put together on the government and then I heard last night that our national debt increased some $300B in ten weeks and we're heavily committed and already sending money to Europe to help them.
What on earth are they thinking? There is no way we can hope to have the real money to back this up without increasing income taxes and/or add a VAT or Value Added Tax. I have property in Canada and travel there often. Some years back they put on a tax, I can't remember what they called it, but it was 15% to pay off their debt. That was a couple decades ago and it is a permanent part of the financial landscape there. When you buy goods there the tax is like near 30% total, as we call it, a sales tax. Look for something creative coming from the Obamanation.
Of course he is going to start saving money now, cutting, you know like a household would have to do. Secretary of Defense Gates has proposed and I hear Obamanation is supporting ... cutting all raises for the military. Great idea in the midst of a war. One of my Marine friends is on his 5th tour now in Afghanistan, he's 30 and a career Marine. He'll be thrilled.
And of course there is the $100M he already announced he was going to save from other cuts. Now to the average person $100M is a lot of money. Check out the video I am going to post above where a young man actually, in plain English and display, will show you how much that is ... my interpretation, if you make $50,000 a year you'd be cutting out about $50 bucks but check out the clever video.
Tuesday, May 11, 2010
I Stand Corrected on Greece?
Yesterday I wrote of the $150B the IMF was giving Greece. Well I found out late yesterday that the continuing moving number is now said to be $1 Trillion dollars, with a T. Now think about that? Germany now decided to pony up and France and the IMF and of course Obamanation says we're going to do more to help.
Think about $1 Trillion dollars to a country of 11,000,000 people. We have cities that big. For some reason the European community is doling out a massive amount of money to a small country that by the way got themselves into this mess. And as I said yesterday, they have all the policies that our Obamanation is trying to force down our throats.
There is more to come on the European front.
Monday, May 10, 2010
Our Country 'On Tilt'
I admit things haven't been great here in America for some time. And I've never been a conspiracy theorist, respecting we each have differing views and need to meet somewhere in the middle. Well, I am nearing the edge of thinking that this guy in the White House and his radical cohorts do have an agenda, and it isn't one that American's signed up for.
Think about how he has alienated or long time ally Great Britain. Then think about how he is daily alienating Israel, our one and only ally in the Middle East. Think about how he ignored the voice of the American people and crammed some sort of healthcare, that Congress doesn't even understand down our throats.
We've all heard of the recent meltdown in Greece. What you may not have heard is that the bailout of Greece will be handled somewhat bu the US - that is the International Monetary Fund or IMF, is doling out over $150B to Greece and that is backed by the US to the tune of 17% ... several billion more we're on the hook for. Makes one wonder.
And get this ... one of the cutbacks the Greek government is making is reducing retiree benefits. Do you know that Greeks got to retire on their government at the ripe age of 54. They all had health insurance benefits for life, all Greeks, and that's nice but the IMF, in loaning them the money for their bailout has demanded that they 'privatize' their health insurance and get out of the business themselves ... Umm?
The there is the case of terrorism, a word the current administration would not utter - until last week when Times Square nearly became another 9-11 ... now our illustrious Homeland Security leader and Attorney General can't say it enough ... we are in a war 'on terror' and they will not let that happen on their watch ... I'm sure it was Bush's fault.
Keep you eye on this crew, something sinister is a brew!
Wednesday, April 28, 2010
Our Tax Dollars at Work Stimulating Jobs
Pyramid Services Inc of Asheboro, NC received a mere $800,000 in stimulus dollars to replace light switches with automatic sensors at US Army facilities in Yuma AZ ... drum roll please ... no new jobs created. Wonderful job by our leaders in DC!
Friday, December 18, 2009
Monday, November 23, 2009
Funky Math out of Washington ... Are We Surprised?
I hope you will be appalled by the following information, regardless of your political affiliation:
The Government Accountability Office (GAO), the nonpartisan investigative arm of Congress, just reported that more than 50,000 jobs claimed to be “created or saved” by the Trillion-dollar stimulus program came from projects where no money has been spent.
In addition, many Congressional Districts that do not exist have appeared on recovery.gov – a website designed to report how stimulus money is spent. In a state with only 32 Congressional Districts, Texas reportedly received stimulus money in the 00, 52nd, 58th, 68th, 85th, 86th, and 91st Congressional Districts. None of these Districts exist!
The financial details of Texas’ phantom districts proved to be even more concerning:
• One job was “created or saved” at a cost of $310,963 in the 68th Congressional District.
• Zero jobs were “created or saved” at a cost of $8,937,289 in the 52nd Congressional District.
• 11 jobs were “created or saved” at a cost of $752, 292 in the 00 Congressional District.
In my home (32nd) District, allegedly 54.8 jobs were “created or saved” at a cost of $59,540,854. That amounts to approximately $1,086,511.93 per job.
If you go to www.recovery.gov I believe you can check out your state if you have the time.
Even the chairman of the stimulus “Accountability and Transparency Board,” Earl Devaney, refused to certify that the number of jobs reportedly “created or saved” by the stimulus is accurate.
What is fact is that over 3 million Americans have lost their jobs since the stimulus became law!
The Government Accountability Office (GAO), the nonpartisan investigative arm of Congress, just reported that more than 50,000 jobs claimed to be “created or saved” by the Trillion-dollar stimulus program came from projects where no money has been spent.
In addition, many Congressional Districts that do not exist have appeared on recovery.gov – a website designed to report how stimulus money is spent. In a state with only 32 Congressional Districts, Texas reportedly received stimulus money in the 00, 52nd, 58th, 68th, 85th, 86th, and 91st Congressional Districts. None of these Districts exist!
The financial details of Texas’ phantom districts proved to be even more concerning:
• One job was “created or saved” at a cost of $310,963 in the 68th Congressional District.
• Zero jobs were “created or saved” at a cost of $8,937,289 in the 52nd Congressional District.
• 11 jobs were “created or saved” at a cost of $752, 292 in the 00 Congressional District.
In my home (32nd) District, allegedly 54.8 jobs were “created or saved” at a cost of $59,540,854. That amounts to approximately $1,086,511.93 per job.
If you go to www.recovery.gov I believe you can check out your state if you have the time.
Even the chairman of the stimulus “Accountability and Transparency Board,” Earl Devaney, refused to certify that the number of jobs reportedly “created or saved” by the stimulus is accurate.
What is fact is that over 3 million Americans have lost their jobs since the stimulus became law!
Saturday, November 21, 2009
One Last Rant on the Auto Industry
I just remembered a couple other things I learned the other day. GM has taken out the option from here forward to order a block heater on any vehicle. Now if you're from Texas, Florida or any warm place this is not biggie. If you're from the great white north it is huge.
As my friend explained to me here in Montana 80% of orders have block heaters and they won't go away. So she says either we force the consumer to eat the cost or we eat the cost of after market installation. And then she told me that the majority of what they are now producing, apparently quite slowly, will come in only one of five colors, all to save costs of course; and, she said since I drive a Suburban I'd wait awhile for the one I want because the government is directing what cars GM makes these days and the majority have to be 'green' vehicles regardless of what the consumer may want.
Space to DC and Detroit ... the dealers are your customers and we, the consumers in the nation are the dealers customers. One of the other owners in the place told me, "Ed, we learned several years ago that when a customer has a problem WE must solve it. Whenever we have turned them over to GM for a solution we have lost them as a customer."
Like I said, I believe there is something sinister going on with the government owning companies ...
As my friend explained to me here in Montana 80% of orders have block heaters and they won't go away. So she says either we force the consumer to eat the cost or we eat the cost of after market installation. And then she told me that the majority of what they are now producing, apparently quite slowly, will come in only one of five colors, all to save costs of course; and, she said since I drive a Suburban I'd wait awhile for the one I want because the government is directing what cars GM makes these days and the majority have to be 'green' vehicles regardless of what the consumer may want.
Space to DC and Detroit ... the dealers are your customers and we, the consumers in the nation are the dealers customers. One of the other owners in the place told me, "Ed, we learned several years ago that when a customer has a problem WE must solve it. Whenever we have turned them over to GM for a solution we have lost them as a customer."
Like I said, I believe there is something sinister going on with the government owning companies ...
Thursday, November 19, 2009
What's Happening to Our Auto Dealers is Criminal
Now that I am finally home I took my Suburban in for service and the owner was there. We've become friends over the years, she runs a great little operation that GM has been trying to force her out of for years. But what she shared that has happened since I'd last visited with her five months ago is ... criminal.
GMAC has been the financing arm for floor planning vehicles for them for years. Of course GM dumped GMAC and they became their own entity and promptly joined the others reaching to the governement for a hand out. I wrote before how they had changed the terms and raised the rates. But this last summer they took it to a whole new level.
They came into this dealership and told her they had 'updated' documents for the changeover they were making and she needed to sign new agreements. She is street smart and her Dad started the dealership a few decades ago, so she said no, she'd read them first. They assured her it was 'routine'. In checking it out she realized they were now saying, to continue them floor planning her vehicles she would have to sign over to them every single thing she and the other two owners - owned. As in personal bank accounts, savings, home you name it. She refused.
They informed her to sign it or they would terminate her floor planning and she owed them for every car on her lot. Imagine that? She refused and they sent notice as of August 31 it was over. Even in our world of increasing car sales, Auto Czar's and the new GM, she was on her own. And for banks these days, despite the condition of the auto industry and all the government money being handed them they consider floor planning cars a bad investment.
She worked tirelessly with a local banker who knew the industry, with some friendly folks in the Minority Dealers group and got connected with the SBA, Small Business Administration. Seems they had done something good for a governement agency and had put in place a floor planning deal when the bankruptcies first happened. Bottom line they all worked together and got her, her own floor planning deal with a local bank backed by the SBA. She'd done it and nobody could believe it.
Tune in tomorrow and see as Paul Harvey used to say ... the rest of the story. See GM's unbelievable response and the criminal part. I'll give you a hint. When she called her Regional Representative she said, "Well it cant be approved". When this lady said well it is and I want to order 2010 cars ... the Regional person from GM said, "Exactly what is the SBA?"
GMAC has been the financing arm for floor planning vehicles for them for years. Of course GM dumped GMAC and they became their own entity and promptly joined the others reaching to the governement for a hand out. I wrote before how they had changed the terms and raised the rates. But this last summer they took it to a whole new level.
They came into this dealership and told her they had 'updated' documents for the changeover they were making and she needed to sign new agreements. She is street smart and her Dad started the dealership a few decades ago, so she said no, she'd read them first. They assured her it was 'routine'. In checking it out she realized they were now saying, to continue them floor planning her vehicles she would have to sign over to them every single thing she and the other two owners - owned. As in personal bank accounts, savings, home you name it. She refused.
They informed her to sign it or they would terminate her floor planning and she owed them for every car on her lot. Imagine that? She refused and they sent notice as of August 31 it was over. Even in our world of increasing car sales, Auto Czar's and the new GM, she was on her own. And for banks these days, despite the condition of the auto industry and all the government money being handed them they consider floor planning cars a bad investment.
She worked tirelessly with a local banker who knew the industry, with some friendly folks in the Minority Dealers group and got connected with the SBA, Small Business Administration. Seems they had done something good for a governement agency and had put in place a floor planning deal when the bankruptcies first happened. Bottom line they all worked together and got her, her own floor planning deal with a local bank backed by the SBA. She'd done it and nobody could believe it.
Tune in tomorrow and see as Paul Harvey used to say ... the rest of the story. See GM's unbelievable response and the criminal part. I'll give you a hint. When she called her Regional Representative she said, "Well it cant be approved". When this lady said well it is and I want to order 2010 cars ... the Regional person from GM said, "Exactly what is the SBA?"
Monday, September 28, 2009
A Great Use of our Tax Dollars - The Prez Support Hamas
I couldnt resist passing tis on:
Subject: HB 1388 PASSED CHECK IT OUT
You just spent $20,000,000 + to move members/supporters of Hamas, a terrorist organization, to the United States ; housing, food, the whole enchilada.
HB 1388 PASSED
Whether you are an Obama fan, or not, EVERYONE IN THE U. S. needs to know....
Something happened.... H.R. 1388 was passed, behind our backs. You may want to read about it. It wasn't mentioned on the news; just went by on the ticker tape at the bottom of the CNN screen.
Obama funds $20M in tax payer dollars to immigrate Hamas Refugees to the USA . This is the news that didn't make the headlines...
By executive order, President Barack Obama has ordered the expenditure of $20.3 million in "migration assistance" to the Palestinian refugees and "conflict victims" in Gaza ..
The "presidential determination," which allows hundreds of thousands of Palestinians with ties to Hamas to resettle in the United States, was signed and appears in the Federal Register.
Few on Capitol Hill, or in the media, took note that the order provides a free ticket replete with housing and food allowances to individuals who have displayed their overwhelming support to the Islamic Resistance Movement (Hamas) in the parliamentary election of January 2006.
Let's review....itemized list of some of Barack Obama's most recent actions since his inauguration:
His first call to any head of state, as president, was to Mahmoud Abbas, leader of Fatah party in the Palestinian territory.
His first one-on-one television interview with any news organization was with Al Arabia television.
His first executive order was to fund/facilitate abortion(s) not just here within the U. S., but within the world, using U. S. tax payer funds.
He ordered Guantanamo Bay closed and all military trials of detainees halted.
He ordered overseas CIA interrogation centers closed.
He withdrew all charges against the masterminds behind the USS Cole and the "terror attack" on 9/11.
Now we learn that he is allowing hundreds of thousands of Palestinian refuges to move to, and live in, the US at American taxpayer expense.
These important, and insightful, issues are being "lost" in the blinding bailouts and "stimulation" packages.
Doubtful? To verify this for yourself: www.thefederalregister.com/d.p/2009-02-04-E9-2488
PLEASE PASS THIS ON... AMERICA NEEDS TO KNOW
We are losing this country at a rapid pace.
Subject: HB 1388 PASSED CHECK IT OUT
You just spent $20,000,000 + to move members/supporters of Hamas, a terrorist organization, to the United States ; housing, food, the whole enchilada.
HB 1388 PASSED
Whether you are an Obama fan, or not, EVERYONE IN THE U. S. needs to know....
Something happened.... H.R. 1388 was passed, behind our backs. You may want to read about it. It wasn't mentioned on the news; just went by on the ticker tape at the bottom of the CNN screen.
Obama funds $20M in tax payer dollars to immigrate Hamas Refugees to the USA . This is the news that didn't make the headlines...
By executive order, President Barack Obama has ordered the expenditure of $20.3 million in "migration assistance" to the Palestinian refugees and "conflict victims" in Gaza ..
The "presidential determination," which allows hundreds of thousands of Palestinians with ties to Hamas to resettle in the United States, was signed and appears in the Federal Register.
Few on Capitol Hill, or in the media, took note that the order provides a free ticket replete with housing and food allowances to individuals who have displayed their overwhelming support to the Islamic Resistance Movement (Hamas) in the parliamentary election of January 2006.
Let's review....itemized list of some of Barack Obama's most recent actions since his inauguration:
His first call to any head of state, as president, was to Mahmoud Abbas, leader of Fatah party in the Palestinian territory.
His first one-on-one television interview with any news organization was with Al Arabia television.
His first executive order was to fund/facilitate abortion(s) not just here within the U. S., but within the world, using U. S. tax payer funds.
He ordered Guantanamo Bay closed and all military trials of detainees halted.
He ordered overseas CIA interrogation centers closed.
He withdrew all charges against the masterminds behind the USS Cole and the "terror attack" on 9/11.
Now we learn that he is allowing hundreds of thousands of Palestinian refuges to move to, and live in, the US at American taxpayer expense.
These important, and insightful, issues are being "lost" in the blinding bailouts and "stimulation" packages.
Doubtful? To verify this for yourself: www.thefederalregister.com/d.p/2009-02-04-E9-2488
PLEASE PASS THIS ON... AMERICA NEEDS TO KNOW
We are losing this country at a rapid pace.
Wednesday, September 23, 2009
Email Your Congressman and Senators Now!
This healthcare bill now sitting in Congress was just voted by all but one Democrat to not put it online for all to see! Unfrigging believable? Like who pays these idiots salary but us ... doesnt matter if you are either party, we all have a right to see what they have done. Especially since the bailout bill was crammed down our throats and then they all said, "Well we didnt know what was in it". Of course that is because they didnt read the danged thing. You can Google email addresses for Senate and the House and you'll get direct links ... do it now! And I am going to post my recent story with the only socialized medicine we have today ... the VA ... and then you'll know why this is a bad idea.
Friday, June 12, 2009
Please Write Your Congressman and Senators
The following is a letter from a local bank president writing on behalf of our local GM dealer, a great lady who I've grown to love and respect over the past few years of buying and doing business there. My next closest dealer is 60 miles away.
The good news, it would seem, is that GM notified here that she is going to still have a business. Of course then, as corporations do, they found a way to do away with her and other small dealers by pulling their financing. And where might you ask is the billions we taxpayers are passing along to GMAC and their lot? Read this letter first and see what is really going on the media isnt bothering to report.
Here is the letter from a local bank president trying to help this small GM dealership. It is to one of our two Senators here in Montana, John Tester.
Senator Tester,
We continue to hear about the massive aid being given to GMAC, including debt guarantees, in a continuing attempt to support the auto industry, but somehow that support is not being felt at the dealership level.
GMAC has taken a very firm line with its dealers, especially the smaller dealers in rural areas, and is pulling their flooring lines and not purchasing contracts on auto purchases that would have been acceptable credits in the past. I can understand that GMAC needs to revise their business operations, but with the assistance they are being provided and the actions of Ally Bank to acquire deposits at double market rate (apparently without the regulatory oversight we are subjected to), it would seem they should be able to continue to support those dealers that have made the initial cut from GM.
I have visited with several folks who have been impacted, and it appears GMAC’s pull back is fairly broad, but to our case in point –
Mission Valley Auto has been in operation for many years, and the present owner – Robin Vert-Rubel, Roland Rubel, and Phil Jarvis – purchased the dealership about 11 years ago from Robin’s father. This is a small, rural dealership, but it has consistently made money, supported the owner’s families, provided employment and serviced the folks of the Flathead Indian Reservation.
Two years ago, reconstruction that section of Highway 93 that accesses the dealership was begun, and for the next 12 to 18 months, access to the dealership was extremely difficult. About the time the road work was completed, the current economic crunch began causing a one – two punch that impacted their revenues. Consequently, they suffered losses in 2007 and 2008, but with the bit of a rebound in consumer confidence, they have been seeing more activity and for the month of May, they were back to nearly breakeven.
Last week they received their “letter” from GM telling them they have been selected to remain a GM dealer, and thanking them for being such an important part of the GM “family”. The following day, they received a letter from GMAC telling them because of their satisfactory trends GMAC was suspending their new vehicle credit line and increasing their interest rate, and gave them until August 30th to place a $150,000 cash collateral with GMAC and to inject an additional $270,000 in unencumbered capital. Obviously a small dealership such as this will not be able to meet these demands.
It appears that GMAC is not willing to look at a decade or more of very satisfactory history and is only concentrating on the past two years of losses, no matter that the loss of revenue was well outside the dealership’s control. It would appear that GMAC is very happy to seek assistance when they were in trouble – arguably at their own lack of business control with their expansion into sub-prime lending – but they are not willing to pass on some of their assistance to small rural dealerships that have been successful, but have had a temporary blow dealt by road construction and the economy.
Unfortunately, with GMAC pulling out of the flooring market, most small dealerships do not have access to any flooring. Most community banks in Montana do not have legal lending limits to carry flooring lines in the $2 million range, and those banks to do have the ability are no longer providing flooring lines. The SBA is trying to launch a flooring line loan program, but development of that loan program is taking some time and will not be available until sometime into July or August I have been told.
Hopefully we will be able to look at an SBA flooring line, but timing will be a problem and the total amount that may be available under the program may be a limiting factor.
The whole approach seems a bit at odds – the intent is to help support GM and other auto manufactures by providing massive support to GMAC (who cause a great deal of their own problems), but there is no support for the small, rural dealerships that would be purchasing the cars from GM and providing the support needed.
It appears this is just another case of the “to big to fail” that community bankers have been struggling with for years. Perhaps you have some thoughts on this dilemma?
Martin M. Olsson
President,
Eagle Bank
80 Heritage Lane
Polson, MT 59860
406-883-2940
The good news, it would seem, is that GM notified here that she is going to still have a business. Of course then, as corporations do, they found a way to do away with her and other small dealers by pulling their financing. And where might you ask is the billions we taxpayers are passing along to GMAC and their lot? Read this letter first and see what is really going on the media isnt bothering to report.
Here is the letter from a local bank president trying to help this small GM dealership. It is to one of our two Senators here in Montana, John Tester.
Senator Tester,
We continue to hear about the massive aid being given to GMAC, including debt guarantees, in a continuing attempt to support the auto industry, but somehow that support is not being felt at the dealership level.
GMAC has taken a very firm line with its dealers, especially the smaller dealers in rural areas, and is pulling their flooring lines and not purchasing contracts on auto purchases that would have been acceptable credits in the past. I can understand that GMAC needs to revise their business operations, but with the assistance they are being provided and the actions of Ally Bank to acquire deposits at double market rate (apparently without the regulatory oversight we are subjected to), it would seem they should be able to continue to support those dealers that have made the initial cut from GM.
I have visited with several folks who have been impacted, and it appears GMAC’s pull back is fairly broad, but to our case in point –
Mission Valley Auto has been in operation for many years, and the present owner – Robin Vert-Rubel, Roland Rubel, and Phil Jarvis – purchased the dealership about 11 years ago from Robin’s father. This is a small, rural dealership, but it has consistently made money, supported the owner’s families, provided employment and serviced the folks of the Flathead Indian Reservation.
Two years ago, reconstruction that section of Highway 93 that accesses the dealership was begun, and for the next 12 to 18 months, access to the dealership was extremely difficult. About the time the road work was completed, the current economic crunch began causing a one – two punch that impacted their revenues. Consequently, they suffered losses in 2007 and 2008, but with the bit of a rebound in consumer confidence, they have been seeing more activity and for the month of May, they were back to nearly breakeven.
Last week they received their “letter” from GM telling them they have been selected to remain a GM dealer, and thanking them for being such an important part of the GM “family”. The following day, they received a letter from GMAC telling them because of their satisfactory trends GMAC was suspending their new vehicle credit line and increasing their interest rate, and gave them until August 30th to place a $150,000 cash collateral with GMAC and to inject an additional $270,000 in unencumbered capital. Obviously a small dealership such as this will not be able to meet these demands.
It appears that GMAC is not willing to look at a decade or more of very satisfactory history and is only concentrating on the past two years of losses, no matter that the loss of revenue was well outside the dealership’s control. It would appear that GMAC is very happy to seek assistance when they were in trouble – arguably at their own lack of business control with their expansion into sub-prime lending – but they are not willing to pass on some of their assistance to small rural dealerships that have been successful, but have had a temporary blow dealt by road construction and the economy.
Unfortunately, with GMAC pulling out of the flooring market, most small dealerships do not have access to any flooring. Most community banks in Montana do not have legal lending limits to carry flooring lines in the $2 million range, and those banks to do have the ability are no longer providing flooring lines. The SBA is trying to launch a flooring line loan program, but development of that loan program is taking some time and will not be available until sometime into July or August I have been told.
Hopefully we will be able to look at an SBA flooring line, but timing will be a problem and the total amount that may be available under the program may be a limiting factor.
The whole approach seems a bit at odds – the intent is to help support GM and other auto manufactures by providing massive support to GMAC (who cause a great deal of their own problems), but there is no support for the small, rural dealerships that would be purchasing the cars from GM and providing the support needed.
It appears this is just another case of the “to big to fail” that community bankers have been struggling with for years. Perhaps you have some thoughts on this dilemma?
Martin M. Olsson
President,
Eagle Bank
80 Heritage Lane
Polson, MT 59860
406-883-2940
Now I want you to think about what they are doing. GM is playing games. They want rid of small dealers, God only knows why as they fill a market void, but then their is no financing for the floor plans. They are being pulled. Does this seem right? Of course not ... and the bozo's on this Task Force are running what is left of a once great industry for America straight into the ground. The current administration is literally putting thousands of businesses out of business. Incredible!
Write your politicians today ... it is the least we can do.
Thursday, May 28, 2009
Frogs in the Proverbial Pot, Heating Up Slowly
A few thoughts this fine morning. GM heading for bankruptcy even after the vaunted Task Force and their money. My local GM dealer predicted this to me and the exact time, just prior to June 1 a few weeks back. The screw job they are doing on their Dealer network should be a felony. And I just realized the other day that the head of Chrysler, the buy turning it around, in none other than the same Nardelli who ran Home Depot in the ground. Think there isnt a 'good ole' boy' network alive and well out there.
Take time to read an article below by Mark Stein, Author of America Alone. He gets to the heart of us 'frogs' in the pot here in America.
http://www.hillsdale.edu/news/imprimis.asp
I'm beginning to sweat, how about you?
Take time to read an article below by Mark Stein, Author of America Alone. He gets to the heart of us 'frogs' in the pot here in America.
http://www.hillsdale.edu/news/imprimis.asp
I'm beginning to sweat, how about you?
Saturday, May 16, 2009
We're About to Print More Money
Heard yesterday that none other than Barney 'Freddie Mac/Fannie Mae' Frank, our illustrious Senator from the great state of Massachusetts, is proposing the federal government bail out the State of California. I guess its only money, eh?
And then I read that the nations largest publicly traded trucking company, some combination of old Roadway and Yellow, is going down and asking for a government bail out as we speak. As I said, its only money.
Houston, er, ah, Washington ... we have a problem.
And then I read that the nations largest publicly traded trucking company, some combination of old Roadway and Yellow, is going down and asking for a government bail out as we speak. As I said, its only money.
Houston, er, ah, Washington ... we have a problem.
Friday, May 15, 2009
The Demise of a Great Industry and an even Greater Country
At 62 years old and as a former corporate executive and consultant, I look at the demise of the auto industry full of emotion. Let’s take General Motors for instance. They once employed nearly 400,000 auto workers in this country. When the latest round of leadership and the vaunted government ‘auto task force’ gets done, they’ll be employing less than 40,000 auto workers. How could this be? Let’s take a look and see what it means to America.
The first problem is leadership arrogance. I remember back in the seventies, under the leadership of Roger Smith, GM suffered from an arrogance that was unequalled at the time. They were on top, led the world with a market share over 50% and were convinced they were invincible. The Japanese made junk and were not a problem.
At the time, my wife and I were living in Akron, Ohio. We’d get up every morning and walk out of the apartment to the aroma of fresh rubber, the smell of jobs for most of Akron. They too suffered from the same leadership arrogance that has led us to our current state of demise in this country. Here we have a problem of the leaders own arrogance blinding them to the reality of the marketplace. The auto industry and the rubber industry are two peas in a bad pod. And always remember, the problems we see here, in Congress and the White House are all leadership problems.
The second problem is the unions. Detroit was fat dumb and happy and since they were riding on top of the world, when all was well and everyone was happy, they made deals no one could be expected to deliver on long term. In Akron, a guy I knew who worked for Goodyear, a once proud company like GM, was twenty-five years old and worked in the factory since high school. He used to take six months off every year, a ‘voluntary layoff’ they called it, and receive 90% of his pay for that time of ‘not working’. It doesn’t take a rocket scientist to figure out that rocket is going to run out of fuel. Here we have a leadership problem in the unions … they priced themselves out of the market.
The third problem is that over time, as corporate America in the late eighties and nineties became enamored with education over experience, Detroit lost touch with the fact that, dealerships, the feet on the street, sell cars. Fancy brochures, car shows and goony advertisements don’t do it. To the average car buyer, you and me, who is General Motors or Chrysler or Ford? GM to me is my local dealer who talks to me when I stop by, who takes care of problems when they happen, and who makes the donations to the Little League my kid plays on. It is not Roger Smith, Rick Waggoner or the Auto Czar now chairing a committee in Washington.
As I write this Chrysler announced the massive closing of dealerships and GM is expected to do the same and for what? Dealerships sell cars and that is Detroit’s problem selling cars. Are the dealerships actually a cash drain on corporate? No! They are independently owned businesses making their own payroll, paying all the floor plan interest to the finance companies that gouge them and they are being shut down. I’ve heard it said to reduce inventory of automobiles. Well ask a dealer if they ‘order’ the cars in inventory. The answer is no, the auto companies set exactly how much inventory they must hold and they’ve been pushing it down their throats for years. Remember, it is always a leadership problem.
The fourth problem is that you have to face your problems to change them. As a recovering alcoholic, I learned I couldn’t stop drinking and destroying my life until I looked in the mirror and said ‘I am a drunk’. The leaders of our once great industries in Detroit and Akron have failed to do that to this day. They don’t get it. Flying to DC for Congressional hearings during an economic meltdown the likes of which we haven’t seen since the Great Depression on private jets. Why are we surprised at our current problems? They still think it is all about them, those few at the top.
I once heard Dr. Stephen Covey say, “You cannot talk yourself out of a problem you behaved your way into.” The leaders in the auto industry have been trying to use smoke and mirrors to fix this problem for the past few decades. That leadership includes the unions too. And who suffers? All of us really, but especially workers who are now entrenched in behaviors and lifestyles leaders gave them and now want to take away. It is sad we live in the greatest nation the world has ever seen and we’re saddled with leaders who have forgotten what got us here, blinded by their arrogance and success which has fueled their destructive greed.
The fifth problem we have is our government. And this isn’t a problem of Republicans or Democrats; they’re both equally inept at this point. It is a problem of leaders suffering from the same disease they blame on the unions … the disease of me. We are led today by a group of people who are so far removed from the everyday, up and down the street American, they don’t have a clue how we live or what we are going through every day.
There is no possible way our founding fathers intended for us to have professional politicians. There is no way they intended our Congressional leadership to have separate retirement programs from the rest of us, to vote in their own pay raises and sit in judgment of others while leading morally bankrupt lives and keep their seat as public servants. Yet we are led by these people who are taking us down a rat hole our once great nation will not return from.
The last problem I will mention is a current one as well. The Auto Task Force established by our new leader in DC to fix this mess. The task force itself deserves its own diatribe but for now understand it is chaired by Timothy Geithner, the Treasury Secretary who was unable by his own admission to operate Turbo Tax, and, who is a known tax evader who was somehow approved for office anyway. The co-chair with him is Lawrence Summers, an economic advisor … and what does any of this have to do with turning around an auto company?
If you think that this is only impacting the auto industry, think again. The same leadership has infected all of corporate America today. It is sad indeed that we sit here in the rubble of what was once America. It will be even sadder if we continue to play in the rubble and do nothing as every day Americans to get ourselves out of it and stop the nonsense that is literally destroying our way of life … for our children.
The first problem is leadership arrogance. I remember back in the seventies, under the leadership of Roger Smith, GM suffered from an arrogance that was unequalled at the time. They were on top, led the world with a market share over 50% and were convinced they were invincible. The Japanese made junk and were not a problem.
At the time, my wife and I were living in Akron, Ohio. We’d get up every morning and walk out of the apartment to the aroma of fresh rubber, the smell of jobs for most of Akron. They too suffered from the same leadership arrogance that has led us to our current state of demise in this country. Here we have a problem of the leaders own arrogance blinding them to the reality of the marketplace. The auto industry and the rubber industry are two peas in a bad pod. And always remember, the problems we see here, in Congress and the White House are all leadership problems.
The second problem is the unions. Detroit was fat dumb and happy and since they were riding on top of the world, when all was well and everyone was happy, they made deals no one could be expected to deliver on long term. In Akron, a guy I knew who worked for Goodyear, a once proud company like GM, was twenty-five years old and worked in the factory since high school. He used to take six months off every year, a ‘voluntary layoff’ they called it, and receive 90% of his pay for that time of ‘not working’. It doesn’t take a rocket scientist to figure out that rocket is going to run out of fuel. Here we have a leadership problem in the unions … they priced themselves out of the market.
The third problem is that over time, as corporate America in the late eighties and nineties became enamored with education over experience, Detroit lost touch with the fact that, dealerships, the feet on the street, sell cars. Fancy brochures, car shows and goony advertisements don’t do it. To the average car buyer, you and me, who is General Motors or Chrysler or Ford? GM to me is my local dealer who talks to me when I stop by, who takes care of problems when they happen, and who makes the donations to the Little League my kid plays on. It is not Roger Smith, Rick Waggoner or the Auto Czar now chairing a committee in Washington.
As I write this Chrysler announced the massive closing of dealerships and GM is expected to do the same and for what? Dealerships sell cars and that is Detroit’s problem selling cars. Are the dealerships actually a cash drain on corporate? No! They are independently owned businesses making their own payroll, paying all the floor plan interest to the finance companies that gouge them and they are being shut down. I’ve heard it said to reduce inventory of automobiles. Well ask a dealer if they ‘order’ the cars in inventory. The answer is no, the auto companies set exactly how much inventory they must hold and they’ve been pushing it down their throats for years. Remember, it is always a leadership problem.
The fourth problem is that you have to face your problems to change them. As a recovering alcoholic, I learned I couldn’t stop drinking and destroying my life until I looked in the mirror and said ‘I am a drunk’. The leaders of our once great industries in Detroit and Akron have failed to do that to this day. They don’t get it. Flying to DC for Congressional hearings during an economic meltdown the likes of which we haven’t seen since the Great Depression on private jets. Why are we surprised at our current problems? They still think it is all about them, those few at the top.
I once heard Dr. Stephen Covey say, “You cannot talk yourself out of a problem you behaved your way into.” The leaders in the auto industry have been trying to use smoke and mirrors to fix this problem for the past few decades. That leadership includes the unions too. And who suffers? All of us really, but especially workers who are now entrenched in behaviors and lifestyles leaders gave them and now want to take away. It is sad we live in the greatest nation the world has ever seen and we’re saddled with leaders who have forgotten what got us here, blinded by their arrogance and success which has fueled their destructive greed.
The fifth problem we have is our government. And this isn’t a problem of Republicans or Democrats; they’re both equally inept at this point. It is a problem of leaders suffering from the same disease they blame on the unions … the disease of me. We are led today by a group of people who are so far removed from the everyday, up and down the street American, they don’t have a clue how we live or what we are going through every day.
There is no possible way our founding fathers intended for us to have professional politicians. There is no way they intended our Congressional leadership to have separate retirement programs from the rest of us, to vote in their own pay raises and sit in judgment of others while leading morally bankrupt lives and keep their seat as public servants. Yet we are led by these people who are taking us down a rat hole our once great nation will not return from.
The last problem I will mention is a current one as well. The Auto Task Force established by our new leader in DC to fix this mess. The task force itself deserves its own diatribe but for now understand it is chaired by Timothy Geithner, the Treasury Secretary who was unable by his own admission to operate Turbo Tax, and, who is a known tax evader who was somehow approved for office anyway. The co-chair with him is Lawrence Summers, an economic advisor … and what does any of this have to do with turning around an auto company?
If you think that this is only impacting the auto industry, think again. The same leadership has infected all of corporate America today. It is sad indeed that we sit here in the rubble of what was once America. It will be even sadder if we continue to play in the rubble and do nothing as every day Americans to get ourselves out of it and stop the nonsense that is literally destroying our way of life … for our children.
Wednesday, May 6, 2009
An Article on the First 100 Days, Dangerous Days
An article by author Stephen Studdert
A Dangerous First 100 Days By Stephen M. Studdert
This week President Barrack Obama marks his first 100 days in office. Never in my experience as a White House advisor or since have I witnessed such a torrid pace of monumental policy change. Cloaked in economic stimulus language, the astonishing breadth and depth of policy transformation and government intervention into the private economy is nothing short of staggering.
The corresponding velocity and mounting magnitude of federal spending is astounding, already 33% higher than the year-ago period. Federal budget deficits exceed anything in our national history. The budget deficit increased by $192.3 billion in just the month of March, over $40 billion more than projected, and is nearly $1 trillion just halfway through the budget year.
For the first six months of the federal budget year, the deficit totals $957 billion. The Obama administration projects the deficit for the entire year will hit $1.75 trillion – nearly four times the previous whopping annual record of $454.8 billion set last year.
The non-partisan Congressional Budget Office now estimates President Obama's budget proposals will result in $9.3 trillion in deficits over the next decade, a figure already $2.3 trillion higher than estimates made in February.
These federal budget deficits will take our national debt to about 80 percent of our gross domestic product. Even spendthrift Europe denies membership in the European Union if a nation's debt is 60 percent of GDP.
In the last 18 months, our unrestrained federal government has spent or loaned or guaranteed a stunning $14 trillion — more than our gross domestic product and more than the national debt of our entire national history. U.S. government debt has almost doubled since November.
Dangerous federal intrusion into what have historically been community or private programs notwithstanding, the most important issue for now remains the economy. While Wall Street economists and some pundits in Washington are saying “the economy is showing signs of recovery”, we each must listen carefully to the true story. This week Lawrence Summers, President Obama's key economic advisor, has admitted the U.S. economy “will continue to decline,” with “sharp declines in employment for quite some time this year.”
Dr. Summers is not alone. Vikram Nehru, the World Bank's chief economist for East Asia , makes similar predictions: "We are still in the middle of a perfect storm. Over the last four months things have gone from bad to worse in many of the advanced economies."
In 1981, Elder Bruce R. McConkie of the Quorum of the Twelve gave an address which he entitled “Parable of the Unwise Builder.”
“A certain man inherited a choice piece of ground whereon to build an house to shelter his loved ones from storms of the day and the cold of the night. He began his work with zeal and skill using good materials for the need was urgent. But in his haste and because he gave no heed to the principles of proper construction, he laid no foundation; but commencing immediately, he built the floor and raised the walls and began to cover them with a roof. Then to his sorrow, because his house had no foundation, it fell and became a heap of rubble and those whom he loved had no shelter. Verily, verily, I say unto you, ‘A wise builder, when he buildeth an house, first layeth the foundation and then buildeth thereon.'”
As a nation, with zeal and haste we are building just such a house – one of unwise and unrestrained federal debt – a house with no foundation that ultimately cannot stand.
With our national house being built on sand, more than ever each of us has a duty, to ourselves and to our families, to be informed. We need this economic information – no matter how serious and troubling it may be. And serious and troubling it is!
The grinding daily news unceasingly bombards our senses with gloomy information, and for most of us we end up with feelings of distress, worry, and even fear. It makes me not want to read or watch any news reports.
Yet the Lord commanded us to “seek ye diligently and teach one another words of wisdom; yea, seek ye out of the best books words of wisdom; seek learning, even by study and also by faith” (D&C 88:188)
Safety is found in being informed and then following the Brethren. Elder Russell M. Nelson has said, “Once you stop putting question marks behind the prophet's statements and put exclamation points instead, and do it, the blessings just pour.”
In these troubled times, the welcome calming messages of General Conference just completed were especially inspiring and filled with hope. The Easter just celebrated renews in each of us a sense of everlasting gratitude for the King of Kings whose Resurrection made salvation and eternal life available to all. These are things of unspeakable joy, peace, comfort, and true happiness.
As we follow the Brethren and listen carefully and heed their inspired counsel, we like the Apostle Paul can say “ We are troubled on every side, yet not distressed; we are perplexed, but not in despair .” (2 Corinthians 4:8).
In what is sure to be an increasingly bumpy ride, individual and family peace and safety come only – but surely – when we are inseparably connected to the Prophets and Apostles, in word and in deed.
A Dangerous First 100 Days By Stephen M. Studdert
This week President Barrack Obama marks his first 100 days in office. Never in my experience as a White House advisor or since have I witnessed such a torrid pace of monumental policy change. Cloaked in economic stimulus language, the astonishing breadth and depth of policy transformation and government intervention into the private economy is nothing short of staggering.
The corresponding velocity and mounting magnitude of federal spending is astounding, already 33% higher than the year-ago period. Federal budget deficits exceed anything in our national history. The budget deficit increased by $192.3 billion in just the month of March, over $40 billion more than projected, and is nearly $1 trillion just halfway through the budget year.
For the first six months of the federal budget year, the deficit totals $957 billion. The Obama administration projects the deficit for the entire year will hit $1.75 trillion – nearly four times the previous whopping annual record of $454.8 billion set last year.
The non-partisan Congressional Budget Office now estimates President Obama's budget proposals will result in $9.3 trillion in deficits over the next decade, a figure already $2.3 trillion higher than estimates made in February.
These federal budget deficits will take our national debt to about 80 percent of our gross domestic product. Even spendthrift Europe denies membership in the European Union if a nation's debt is 60 percent of GDP.
In the last 18 months, our unrestrained federal government has spent or loaned or guaranteed a stunning $14 trillion — more than our gross domestic product and more than the national debt of our entire national history. U.S. government debt has almost doubled since November.
Dangerous federal intrusion into what have historically been community or private programs notwithstanding, the most important issue for now remains the economy. While Wall Street economists and some pundits in Washington are saying “the economy is showing signs of recovery”, we each must listen carefully to the true story. This week Lawrence Summers, President Obama's key economic advisor, has admitted the U.S. economy “will continue to decline,” with “sharp declines in employment for quite some time this year.”
Dr. Summers is not alone. Vikram Nehru, the World Bank's chief economist for East Asia , makes similar predictions: "We are still in the middle of a perfect storm. Over the last four months things have gone from bad to worse in many of the advanced economies."
In 1981, Elder Bruce R. McConkie of the Quorum of the Twelve gave an address which he entitled “Parable of the Unwise Builder.”
“A certain man inherited a choice piece of ground whereon to build an house to shelter his loved ones from storms of the day and the cold of the night. He began his work with zeal and skill using good materials for the need was urgent. But in his haste and because he gave no heed to the principles of proper construction, he laid no foundation; but commencing immediately, he built the floor and raised the walls and began to cover them with a roof. Then to his sorrow, because his house had no foundation, it fell and became a heap of rubble and those whom he loved had no shelter. Verily, verily, I say unto you, ‘A wise builder, when he buildeth an house, first layeth the foundation and then buildeth thereon.'”
As a nation, with zeal and haste we are building just such a house – one of unwise and unrestrained federal debt – a house with no foundation that ultimately cannot stand.
With our national house being built on sand, more than ever each of us has a duty, to ourselves and to our families, to be informed. We need this economic information – no matter how serious and troubling it may be. And serious and troubling it is!
The grinding daily news unceasingly bombards our senses with gloomy information, and for most of us we end up with feelings of distress, worry, and even fear. It makes me not want to read or watch any news reports.
Yet the Lord commanded us to “seek ye diligently and teach one another words of wisdom; yea, seek ye out of the best books words of wisdom; seek learning, even by study and also by faith” (D&C 88:188)
Safety is found in being informed and then following the Brethren. Elder Russell M. Nelson has said, “Once you stop putting question marks behind the prophet's statements and put exclamation points instead, and do it, the blessings just pour.”
In these troubled times, the welcome calming messages of General Conference just completed were especially inspiring and filled with hope. The Easter just celebrated renews in each of us a sense of everlasting gratitude for the King of Kings whose Resurrection made salvation and eternal life available to all. These are things of unspeakable joy, peace, comfort, and true happiness.
As we follow the Brethren and listen carefully and heed their inspired counsel, we like the Apostle Paul can say “ We are troubled on every side, yet not distressed; we are perplexed, but not in despair .” (2 Corinthians 4:8).
In what is sure to be an increasingly bumpy ride, individual and family peace and safety come only – but surely – when we are inseparably connected to the Prophets and Apostles, in word and in deed.
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