Big shocker! General Motors and Chrysler probably won’t be able to pay back all those loans we’ve extended them! From the just-released September report of the Congressional Oversight Panel assigned with keeping an eye on the Troubled Asset Relief Program:
Although taxpayers may recover some portion of their investment in Chrysler and
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The recession has provided a moment to step back and contemplate, to come to a truer understanding of life lessons like that happiness is not derived from material things. The financial downturn has also passed along some slightly odd teachings, like that fewer people die at the workplace when there are fewer people actually at work.
For as long as I can remember, the assumption has always been: It is better to own than to rent a home. But for quite some time now, what that meant to a lot of people was that it was better to speculate than to play it safe.
Bloomberg has broken the news that the FDIC is about to take over Alabama-based Colonial Bancgroup and sell its branches and deposits to those objectivists at BB&T. This is the biggest bank failure of the year, although not on the scale of last year’s Wamu takeover—Colonial has $26 billion in assets. But for anybody who has lived in …
General Motors, after prematurely announcing the news back in July (before it actually had a deal with eBay), is really truly going to start selling cars via eBay on Tuesday. You can tell it’s for real this time because the press release announcing the program is available on the eBay website (pdf!) as well as the GM one. And there’s …
The FT reports on new research showing that female directors damage corporate profits. Sexy headline. I dug up the study itself to try to resolve the fact that other research has shown the exact opposite (as the piece in the FT points out). Here are the main conclusions of the research, by Renee Adams of the University of Queensland and …
From Zeit Online (clunky translation mine):
In Germany the government-promoted auto boom is gradually coming to an end. Thanks to cash for clunkers (Abwrackprämie) the number of new-car sales in July was, at 340,000 vehicles, still 30% higher than the previous year’s level, reported the Federal Motor Vehicle Office
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For my previous post on the economics of cash for clunkers, I tried to get Alan Blinder’s take—since the whole danged thing was his idea—but didn’t hear back from him on time. Now I’ve just gotten this e-mail from him:
I always thought that cash for clunkers would be an effective stimulus, but it seems to have exceeded expectations.
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It all began a year ago with a suggestion from a prominent economist. Wrote Princeton University’s Alan Blinder in the July 27, 2008 New York Times:
Economists and members of Congress are now on the prowl for new ways to stimulate spending in our dreary economy. Here’s my humble suggestion: “Cash for Clunkers,” the best stimulus
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My new column, on Washington’s campaign to regulate executive and Wall Street pay, is online. It’s got a lot of Lucian Bebchuk in it, and this morning Bebchuk is at it again, with a WSJ.com op-ed (co-authored with his Harvard Law School colleague Alma Cohen) making the case that it appears banks have actually gotten more generous in …
There have been two main theories of why things went so wrong at General Motors. One is that the company is run by a bunch of ingrown retreads with no sense of where the automotive business was headed. The other is that the company’s management has been so burdened by commitments (to pensions, to retiree health care, to union work rules) …
Chapter 11 bankruptcy is one of the greatest glories of American capitalism. It evolved organically during the financial crises of the late 1880s, was replaced with a more punitive code in the 1930s, and then was resurrected and codified in the late 1970s. Chapter 11 allows companies that got in over their heads to seek a way out that …