If anything, cerberus ran chrysler into the ground even harder than Daimler. The only thing they’re going to be better at is peddling for our tax dollars with their board members.

Perhaps you can try to use your experience to make accurate points less full of fail.

BTW — Using the phrase “MORE full of fail” does not exactly create an image of experience and wisdom on the part of the author. It’s more like: “recent college graduate with a business degree who thinks he/she knows everything.” I’m a 15-year non-union, white-collar veteran of the auto industry, and I haven’t got time for that cutesy crap.

1. Nationalization
2. Chap11 or the like
3. Chap7

In order of our money spent. In my opinion, at this point, 3 is likely the best option. Since I’ve already made it clear it’s just down to gov money smoothing out the human impact of the fall off the cliff, let’s just kill the problem (structural deficiencies of the big2/3) in the most effective way (sale to whoever actually knows how to make cars profitably) and use our money to directly benefit those impacted instead of shoveling more into the fire.

But that’s never going to happen, so realistically it’s varying shades of 2.

—-
ACR man, here are the answers:

1. Either the gov directly or gov payment for loan guarentees (from another lender). All 3 options are going to be our tax money because if it’s not already obvious no one else is willing to do this.

2. A significant amount (let’s say a Billion). But very little compared to the overall charge we’re going to take even in the best case (3 above will take the least, but the realistic choices are >100Billion).

3. I don’t live in the south, and it doesn’t matter either way because reality has no regional bias.

Three questions:

1. Where is the Chapter 11 financing going to come from?

2. How much will be wasted on legal fees during Chapter 11 proceedings?

3. In which Southern, right-to-work state does “Agenthex” live?

Now, socialized medicine on the other hand… that could do wonders for Detroit’s labor/legacy costs.

Just sayin’. =D

Also, I should point out that while something bankruptcy-like is the least worst solution, it’s likely to fail anyway. Forecasts for 2k9 call for a drop to only ~10m units. Now try to think of how companies with huge fixed costs and without a big piggy bank would survive something like that (even with injection of substantial liquidity). Also, it’s worth mentioning the credit problem is going to be significantly worse for the Detroit 3 than the competition since their captive lenders are insolvent and their residuals are in the toilet.

To head off the obvious but incorrect rebuttal to this, the alternative of essentially nationalizing the industry is going to carry all of the costs PLUS whatever concessions due to chap11 haircuts, and thus is MORE full of fail.

It doesn’t take much imagination to figure out what the solution there is, and without the stigma this time. Ch11 was designed for this sort of situation.

how would Chrysler or GM obtain Debtor In Posession financing to complete even the first year of what would be a protracted Chapter 11 proceeding

The gov. DIP loans are the best possible deal for the taxpayer given that some form of bailout is inevitable.

http://www.autonews.com/assets/PDF/CA59103122.PDF

In the current “frozen” credit market, how would Chrysler or GM obtain Debtor In Posession financing to complete even the first year of what would be a protracted Chapter 11 proceeding? Bankruptcy is never a fun proposition, but at least the major airlines and giant auto supplier Delphi had the good fortune to file Chapter 11 when the capital markets were working normally and capital was available. In the current credit climate, Chapter 11 is a death sentence for GM and Chrysler.