government bail outs

Obama Connection to Solyndra?

Mark Noonan3 Comments

Just what are the full details of that “green jobs” loan to Solyndra?  Inquiring minds want to know – and fortunately Bruce Krasting over at Zero Hedge has been digging around:

I wrote about the solar panel manufacturer Solyndra last week; “Government Investment Disaster in the Works” I highlighted all of the negatives that the company was facing.

It was pretty clear to me that that company was facing trouble. But I had no idea that they would file Chapter 11 the very next day. (Sometimes you just get lucky)

I also made note of some scuttlebutt that George Kaiser (Oklahoma oil billionaire) was involved with Solyndra. I have been looking for a confirmation of this. Kaiser is an important link in this story. He is also a very big fund-raiser for Obama. He is often referred to as a “Bundler”. In this case that means he encouraged/pushed others to put up money for the big O’s campaign…

Checking on that and Kaiser is, indeed, a bundler (per Open Secrets).  Don’t know how much he’s done for Obama lately, but for the ’08 cycle he raked in 33,600.00 for Obama – not as much as some of the big boys, but a tidy sum, none the less.  So, we have a big Obama donor who is heavily invested in a firm that Obama cares greatly about (remember, he used the firm as a backdrop for his efforts to convince the people that he’s doing good work as President) – that firm received a hefty loan from the government and has now gone bankrupt.  All that is bad enough…but the Zero Hedge article goes on to claim that in February of this year, Solyndra’s debts were reorganized in such a way that the taxpayer loan went to the back of the bus as far as repayment in bankruptcy goes, while firms like Kaiser’s went to the front of the line.  Convenient, huh?  Imagine that – just six months before it goes belly up, the debt structure is changed to the unusual situation where debtors like Kaiser are at the head of the line.  That is either stupendously good timing, or someone worked an inside deal…in this case, maybe a phone call to Barry or one of his minions from Kaiser?

We don’t know. Could be just the most amazing run of luck imaginable.  But it is something we need to know…after all, quite a lot of money was passed out via stimulus and we should get answers to the following:

1.  How many have failed?

2.  How many are currently in danger of failing?

3.  How many have investors people who were large donors to President Obama?

4.  In all the failed and possibly failed firms, did any of them have their debts reworked to put taxpayers last and banksters first?

I suggest a House hearing in order to clear this up.  Tens of billions of taxpayer dollars were doled out after the stimlus passed, and we need to ensure that it was all used properly…that no one used political connections to get the money nor used them to cover their losses for those firms which have failed.

Crony Capitalism

Mark Noonan4 Comments

From Bloomberg:

…Fed Chairman Ben S. Bernanke’s unprecedented effort to keep the economy from plunging into depression included lending banks and other companies as much as $1.2 trillion of public money, about the same amount U.S. homeowners currently owe on 6.5 million delinquent and foreclosed mortgages. The largest borrower, Morgan Stanley (MS), got as much as $107.3 billion, while Citigroup took $99.5 billion and Bank of America $91.4 billion, according to a Bloomberg News compilation of data obtained through Freedom of Information Act requests, months of litigation and an act of Congress…

Describing it as an effort to stave off depression is being overly generous…though, giving the benefit of the doubt, Bernanke, himself, might have thought that is what he was doing.  The reality is that a bunch of well-connected banks gambled, lost and then were bailed out by the taxpayers.  The whole effort, in reality, was to ensure that those at the top of the financial industry heap didn’t pay the price of their folly…and they managed to get all that money because, as I’ve said, Big Government and Big Corporation are two sides of the same coin…they are run by the same people and have the same basic worldview:  the people are lunch.

We have to ensure that in the future no one ever falls for “too big to fail”.  If a corporation has screwed up, then let it fail.  In this, there is a gigantic issue we Republicans can run on because, right now, Obama and his Democrats are hip deep in this nonsense.  There was no fundamental difference between the bail out of GM and the bail out of Morgan Stanley…both were run by idiots who deserved to lose and both were bailed out because of excellent political connections.

We can tie the whole nauseating mess in to a neat, little package and explain to the American people that the “Bigs” have to go, because both of them are bad.  Thing is – do we have the courage to do it?

Obamunism! GM Failing, Again

Mark Noonan18 Comments

From Bloomberg:

General Motors Co. (GM) stocked Jim Ellis Chevrolet in Atlanta with plenty of Silverado full-size pickups in early 2011, part of a wager on a strong economic recovery. The strategy is backfiring.

“We thought that this year would bring back the kind of economic activity that would translate into us selling more trucks,” Mark Frost, the dealership’s general manager, said in a phone interview. “It’s not happening.”…

…After GM’s truck inventory swelled to 122 days worth of average sales, the company said 100 to 110 will be normal going forward for such a large and complex line of vehicles, compared with 60 to 70 days for most models. Peter Nesvold, a Jefferies & Co. analyst, isn’t convinced. Ford Motor Co. (F), which makes similar trucks, is running at 79 days, and Nesvold says GM averaged 78 days on hand at year end from 2002 to 2010…

That first bit is nonsense – GM didn’t pile vehicles in to the dealership in anticipation of an economic rebound, but merely to have vehicles “sold” on the books.  From what I understand, GM counts a vehicle as sold when it is sent to the dealership.  If you want to fake your numbers and make it look like your taxpayer bailed out corporation is recovering, this is how you do it…”stuff” the dealerships with vehicles, call them “sold” and allow President Obama to state that we’re heading in the right direction.  Zero Hedge, though, has been on this since last December, and had an update on July 1st – here’s the chart:

Up and up and up goes the inventory – more and more cars being produced, with taxpayer subsidies, which no one has any money to buy.  A very large amount of our GDP “growth” over the past two years has been this sort of thing – inventory build up. Part of this is just corruption – as in GM’s case where they are trying to make a major Obama policy look like a success – while another part is just idiocy – a blinding faith in Keynesian economics which infects our entire economy.  Including in corporate board rooms where economists have received the same sort of Keynesian indoctrination that government and academic economists have received:  if government spends money, it will fix the economy.

This is Obamunism, good people – the final test that Keynes was wrong; that spending doesn’t make you rich.  The only thing which can make us rich is a free market economy based upon hard work, savings and careful investment.  Government’s only functions are to ensure a sound money supply, a balanced budget and that no one is using fraud to get ahead.  Once we get to that happy state of affairs, we’ll have a real economic recovery…until then, we’ll just wallow in the doldrums with a complete collapse possibly literally at any time.