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Gettlefools' Bet Gets Called: ALL IN!
The Market Ticker ^ | February 15. 2009 | Karl Denninger

Posted on 02/16/2009 6:18:24 PM PST by An Old Man

Well well well. In an update to my "GM Goes Boom" Ticker, it appears that we may now have to ask: Did Obama grow a pair?

"WASHINGTON - President Barack Obama plans to appoint senior administration officials — rather than a single "car czar," as had been discussed — to oversee a restructuring of the auto industry.

Treasury Secretary Timothy Geithner and National Economic Council Director Lawrence Summers will oversee the across-the-government panel, a senior administration official said Sunday on the condition of anonymity because no announcement had been made.

It has also been rumored that President Obama himself will make any final decision on whether any further assistance will be rendered to the automakers.

Gettlefool has overplayed his hand. He was caught admitting that he scuttled the bill originally planned to help the automakers and forced it through Treasury because "he had Bush in his back pocket", a move that infuriated Senators and guaranteed that there was no chance whatsoever the bill could pass there.

The UAW was reported to have broken off talks on Friday, although there are rumors that talks restarted today.

Someone needs to whack this idiot upside the head and explain to him that a union that is smaller but still exists is better than one that dies entirely or undergoes forced Chapter 11 renegotiation of its contracts. If the UAW thinks that it will do better in bankruptcy court than it will in negotiations I have a bridge to sell UAW members, and they should have a look at what happened to union airline pilots when United went under - including their pensions.

Hint: How's a 50-75% reduction in your promised pension benefits sound, complete elimination of SUB pay (which is NOT covered by pension guarantees) and complete elimination of ALL post-retirement or post-layoff private health insurance, leaving you with nothing until you can qualify for Medicare?

That's what you're going to get if you're a UAW member and let this clownface continue to play his game of "hardball".

This is truly "the final countdown" for the UAW membership.


TOPICS: Business/Economy; Culture/Society; Government; News/Current Events
KEYWORDS: forcedliquidation; forex; gm; haironfire

More Cheerie News

Karl has more at The Market Ticker

1 posted on 02/16/2009 6:18:24 PM PST by An Old Man
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To: An Old Man

I truly hope the UAW completely self-destructs


2 posted on 02/16/2009 6:24:39 PM PST by txnativegop (God Bless America! (NRA-Endowment))
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To: An Old Man

Gee, what is that song they sang to Bush on Inaguration Day?
Sheudenfraude?

Na na na na, na na na na, hey hey hey, goodbye......


3 posted on 02/16/2009 6:26:16 PM PST by wombtotomb (since its "above his paygrade", why can't we err on the side of caution about when life begins?)
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To: txnativegop
A committee of political washington bureaucrats running GM? Yeah, that will work. I can predict with absolute certainty that that will fail just like everything else washington does.
4 posted on 02/16/2009 6:29:50 PM PST by paul51 (11 September 2001 - Never forget (July 4, 2009 see you there))
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To: paul51

After GM fails, will Detroit even notice?


5 posted on 02/16/2009 6:30:42 PM PST by txnativegop (God Bless America! (NRA-Endowment))
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To: An Old Man

Geithner has no clue what he is doing with the financial meltdown. So, Soetoro is going to give him the auto industry to solve, too? I can’t wait for his press conference to announce his plan, “We need $100 billion for the auto companies, but we haven’t worked out any specifics for this plan yet...we want to make sure we get it right.”


6 posted on 02/16/2009 6:31:36 PM PST by Raster Man
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To: An Old Man
He's got an update. Sounds ominous:

---------

8:17 CT

I do not know what is going on here, and I don't think I want to.

Someone, apparently someone in Asia, wants dollars.  A LOT of dollars.  There is a forced-liquidation event underway that is massive, it is against all asset classes and it is spreading.

It originated at approximately 7:15 CT this evening and originated out of Asia somewhere.  All of the primary currency crosses got hit at once - Euro, Pound, Yen - all weakened dramatically against the dollar and it is still going on.  The Asian stock markets got walloped at the same time in coordinated waves of forced selling.

At the same time the US futures markets got nailed as well, down some six handles on the /ES in a near-vertical drop.  While this sounds "not that big" to move these markets in a coordinated fashion like this is a trillion-dollar enterprise - this is not some small company that went bankrupt, or even a large company.

There is no news coverage at the present time identifying the source of this but it is not small and contrary to some reports it is not "automatic selling"; this is forced liquidation.

Folks, if this translates into Eastern Europe where there are severe instabilities already brewing literally everything in the financial world could come apart "all at once."

The worse news is that if this happens Bernanke will have killed us (in the US) by extending those swap lines all over the planet during the last six months.  These will become utterly uncollectable and they are massive, in the many hundreds of billions of dollars.

To those who are reading this, I hope if you're in the markets you are prepared for extreme levels of violence.  You must expect that the authorities will try to arrest the destruction if they are able, but you must also be prepared for the possibility that we have reached a "critical mass" point beyond which "duck and cover" is the only winning strategy.

Unfortunately.

---------

7 posted on 02/16/2009 6:34:51 PM PST by FReepaholic (Diversity = .45 .357 .223 .38 ...)
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To: An Old Man

I find it rather ironic that osamaobama ridiculed and attacked McCain for wanting to set up a committe to draft and administer TARP-now he’s proposing the same thing for the auto industry.


8 posted on 02/16/2009 6:37:47 PM PST by mrmargaritaville
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To: An Old Man

poo in a ziplock


9 posted on 02/16/2009 6:37:51 PM PST by Cyber Ninja (His legacy is a stain OnTheDress)
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To: FReepaholic

What exactly does that mean?


10 posted on 02/16/2009 6:38:36 PM PST by maxter (Give today a chance. Enjoy.)
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To: paul51
As a rule, I hate ALL committees, particularly government committees. But you have to admit, this is going to be funny! A committee of government bureaucrats, one beholden to every left wing kook cause no less, running an automobile company?

Who would be dumb enough to buy the product? I tell you this, if a government committee ran the toilet paper business, I would never shake hands with anyone again!

11 posted on 02/16/2009 6:39:05 PM PST by shempy (BOYCOTT GM & CHRYSLER - support American VALUES!)
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To: FReepaholic; rabscuttle385; TigerLikesRooster

I don’t know! Lets find out.


12 posted on 02/16/2009 6:48:24 PM PST by An Old Man (Use it up, Wear it out, Make it do, or Do without.)
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To: maxter
...What exactly does that mean?...

Currency market. Forex.

13 posted on 02/16/2009 6:51:08 PM PST by FReepaholic (Diversity = .45 .357 .223 .38 ...)
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To: An Old Man
There can be no outcome severe enough to properly “compensate” the UAW for the damage they have done to their industry or the Republic.....
14 posted on 02/16/2009 6:51:54 PM PST by river rat (Semper Fi - You may turn the other cheek, but I prefer to look into my enemy's vacant dead eyes.)
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To: An Old Man

Henry Ford is thanking God that Ford backed out of the govmt bailout.

Ford may come out as the only American car manufacturer in about 3 years.


15 posted on 02/16/2009 6:52:28 PM PST by american_ranger (Never ever use DirecTV)
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To: FReepaholic

What do you suppose we should expect?


16 posted on 02/16/2009 6:52:38 PM PST by txhurl (ralph)
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To: maxter; FReepaholic

Well, he says he doesn’t know, but it sounds like Somebody that owns a lot of debt is calling in the markers and forcing fire sales to other entities to raise money. He also says there’s no coverage of it, just a lot of forced liquidation, which means whoever’s letting the assets go is doing it at a fire sale price. Freepaholic, is that how you read it?


17 posted on 02/16/2009 6:59:24 PM PST by Richard Kimball (We're all criminals. They just haven't figured out what some of us have done yet.)
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To: txhurl; Richard Kimball
...What do you suppose we should expect?...

I have no idea. I just lurk on Denningers' forums. I'm not a finance guy.

Here's the current forum thread on his latest update:

RED ALERT: FX Dislocation In Process

18 posted on 02/16/2009 7:05:28 PM PST by FReepaholic (Diversity = .45 .357 .223 .38 ...)
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To: An Old Man

http://www.tickerforum.org/cgi-ticker/akcs-www?post=81089

Hysteria or Cassandra, it’s a fascinating read.


19 posted on 02/16/2009 7:06:39 PM PST by Petronski (For the next few years, Gethsemane will not be marginal. We will know that garden. -- Cdl. Stafford)
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To: shempy
Who would be dumb enough to buy the product?

The same gov't that will be unable to compete will make sure you have no other options but to buy their product at their price. The hand writing is on the wall

20 posted on 02/16/2009 7:16:31 PM PST by paul51 (11 September 2001 - Never forget (July 4, 2009 see you there))
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To: Petronski

Karl/KD/Genesis is prone to occasional hair-on-fire moments. But, he’s rarely dead wrong. Just early.


21 posted on 02/16/2009 7:32:07 PM PST by RegulatorCountry
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To: txnativegop

I truly hope the UAW completely self-destructs

That would be a boon to the US auto industry as a whole.

Right now, the UAW is just a big roadblock to what needs to happen: lower emplyoment, lower pay, lower benefits and write off and contain unfunded liabilities.

Pain all around, but the sooner the better.
And shame on the Obama Democrats for screwing the taxpayer.


22 posted on 02/16/2009 9:06:09 PM PST by WOSG (Oppose the bailouts, boondoggles, big Government)
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To: WOSG

Obama is on a mission...to increase the number of US non-taxpayers....


23 posted on 02/17/2009 8:02:43 AM PST by Ernest_at_the_Beach (No Burkas for my Grandaughters!)
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