Should Cerberus Chrysler Get A Bailout Without Transparency?
Embarrassment is a motivator to learn quickly as most of us can attest. Politicians are a crafty lot. It doesn't take too many embarrassments before they learn from their mistakes. Paulson's threats and fear mongering over the TARP program were more representative of something we would see from Mussolini than from a democratic society. After being embarrassed by Paulson, Congress is cracking the whip more assertively with the auto mess. Of course, some of it is posturing for the camera. If they don't go back and demand the same terms from banks, we'll have even more anecdotal evidence that Congress has some serious conflicts of interest that don't represent the sovereign.
I watched former Treasury Secretary and current Cerberus CEO John Snow a week or so ago when he coincidently showed up on CNBC at the same time Cerberus was groveling for a Chrysler bailout. His less than forthright answers to questions about Cerberus's financial position left me very disappointed. It is clear Snow is more beholden to his financial keepers - the Cerberus partners - than to transparency and honesty with the American people. I don't necessarily fault Snow for this position but I do fault CNBC for even putting him on the air without any pre-airing debriefing. In other words, if these guests aren't going to be transparent and forthright, why even invite them?
Congress is readying a bailout for Chrysler but we don't even know if its parent company Cerberus needs any financial assistance. Cerberus hasn't disclosed its financial situation unlike Ford and GM which are publicly traded companies. Wouldn't it be nice if Congress would demand Cerberus disclose its financial position or take a hike on any loans?
Another story shows how Cerberus has literally bought favor by hiring politicians to lobby your government. Who lobbies for you?
This brings up an interesting side story. When the rumors of a GM/Chrysler merger were circulating in the press, I kept wondering to myself how anyone with an ounce of business acumen could even remotely entertain such a death wish. There is not a management consultant worth their salt who would support such a move given the circumstances. The only potential pluses for GM were that it could raid Chrysler's cash and kick a competitor to the side of the road. In other words, remove competition from the market place. But, trying to integrate a business that completely overlaps with GM and a product mix that is the worst in the industry would likely destroy GM. That is, unless it quickly wrote off and closed down Chrysler. That would create such a backlash in the market that no competent CEO would ever consider such a vile move. Now we see while under the gun GM is recommending what we have long said - GM needs to cut brands. So, tell me again, how would a company now acknowledging it has too many brands benefit by picking up more brands with Chrysler? It's funny you would ask.
Low and behold it has now leaked that there was a presentation circulating on Wall Street that made very dubious claims of what great benefit would be achieved by combining the two companies. Dubious is another word for deceit in this situation. I wonder why? Come to find out, it appears that some firms on Wall Street were loaded up with Chrysler debt taken on with the Cerberus purchase of Chrysler. Debt that Wall Street was unable to pump and dump before the credit markets started collapsing.
What better way for all of the banksters to make off with the cash and dump Chrysler regardless of the consequences to its employees than by Wall Street and Cerberus concocting some scheme about how great a GM/Chrysler merger would be then pumping it in the press. Maybe even get a few supposedly independent lackies to say some supportive words. Maybe throw a few bones to GM. Bada bing and Cerberus is free of Chrysler and the banksters are free of a large load of toxic debt. Now, of course, I'm sure Cerberus and Wall Street would never do anything like this, so it's simply a little exercise in "what if" fun.
So, do some of the richest people in the world deserve a bailout from us average slobs because their personal investments went south? Especially without sharing their financial situation?
I watched former Treasury Secretary and current Cerberus CEO John Snow a week or so ago when he coincidently showed up on CNBC at the same time Cerberus was groveling for a Chrysler bailout. His less than forthright answers to questions about Cerberus's financial position left me very disappointed. It is clear Snow is more beholden to his financial keepers - the Cerberus partners - than to transparency and honesty with the American people. I don't necessarily fault Snow for this position but I do fault CNBC for even putting him on the air without any pre-airing debriefing. In other words, if these guests aren't going to be transparent and forthright, why even invite them?
Congress is readying a bailout for Chrysler but we don't even know if its parent company Cerberus needs any financial assistance. Cerberus hasn't disclosed its financial situation unlike Ford and GM which are publicly traded companies. Wouldn't it be nice if Congress would demand Cerberus disclose its financial position or take a hike on any loans?
Another story shows how Cerberus has literally bought favor by hiring politicians to lobby your government. Who lobbies for you?
This brings up an interesting side story. When the rumors of a GM/Chrysler merger were circulating in the press, I kept wondering to myself how anyone with an ounce of business acumen could even remotely entertain such a death wish. There is not a management consultant worth their salt who would support such a move given the circumstances. The only potential pluses for GM were that it could raid Chrysler's cash and kick a competitor to the side of the road. In other words, remove competition from the market place. But, trying to integrate a business that completely overlaps with GM and a product mix that is the worst in the industry would likely destroy GM. That is, unless it quickly wrote off and closed down Chrysler. That would create such a backlash in the market that no competent CEO would ever consider such a vile move. Now we see while under the gun GM is recommending what we have long said - GM needs to cut brands. So, tell me again, how would a company now acknowledging it has too many brands benefit by picking up more brands with Chrysler? It's funny you would ask.
Low and behold it has now leaked that there was a presentation circulating on Wall Street that made very dubious claims of what great benefit would be achieved by combining the two companies. Dubious is another word for deceit in this situation. I wonder why? Come to find out, it appears that some firms on Wall Street were loaded up with Chrysler debt taken on with the Cerberus purchase of Chrysler. Debt that Wall Street was unable to pump and dump before the credit markets started collapsing.
What better way for all of the banksters to make off with the cash and dump Chrysler regardless of the consequences to its employees than by Wall Street and Cerberus concocting some scheme about how great a GM/Chrysler merger would be then pumping it in the press. Maybe even get a few supposedly independent lackies to say some supportive words. Maybe throw a few bones to GM. Bada bing and Cerberus is free of Chrysler and the banksters are free of a large load of toxic debt. Now, of course, I'm sure Cerberus and Wall Street would never do anything like this, so it's simply a little exercise in "what if" fun.
So, do some of the richest people in the world deserve a bailout from us average slobs because their personal investments went south? Especially without sharing their financial situation?
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