Wednesday, December 31, 2008
These primitive rockets, with no guidance abilities, are being launched wildly into Israeli towns. They are a classic terror weapon, like the buzz-bombs of the Luftwaffe.
Tuesday, December 30, 2008
Monday, December 29, 2008
Now, before you shout that GMAC may go bankrupt, and eat my deposits, know that GMAC Bank is FDIC insured. So even if GMAC did go bankrupt, and GMAC Bank is a division of GMAC, FDIC would step in, and in a few days I would have my money back.
This is in contrast with the GMAC Demand Notes (5.25%) or Ford Motor Credit's Interest Advantage (3.9-4.2%), which are unsecured loans directly to the companies. If you are invested in GMAC Demand Notes or Ford Motor Credit Interest Advantage, you should re-evaluate your tolerance for financial risk right away, because I am guessing that you are investing money you consider "safe", but what you are buying is basically a junk bond.
And, by putting money in GMAC, I can help GM by providing badly needed cash to their lending arm, and helping support the Detroit auto industry.
There are some downsides to GMAC Bank. It are online-only, so if you want to be able to talk to a human being about your account, the only option is the telephone. It also doesn't support direct connection through Quicken or Microsoft Money, if you want to download transactions you have to use the manual download feature on your account page.
Note: GMAC did not sponsor this post or influence it in any way.
Read here about Minnesota.
California law changes in January 2009 to allow GPS units, but they must be located at the lower left or lower right corner of the winshield.
In other news, Minnesota is considering a law to require Minnesotans to tie their shoes with double-knots, to prevent accidental tripping.
Thursday, December 25, 2008
I got it running by doing two things: first, I set SWRepublicCommando.exe to run as administrator. Second, in the game, under the graphics settings, I set "bump-mapping" to low.
Tuesday, December 23, 2008
The interior looks nice, and looks like it has a lot in common with the MKS interior (notice the steep rake of the center stack). Also notice the Sony audio system.
See all pics here.
This is a crucial product for Ford, after the flabby sales (<100K annualized) of the current 500/Taurus. The Taurus should be Ford's flagship. It looks to me like it will be a contender, though we don't know what will be under the hood yet. Will it be the 3.5L V6 from the Edge and Flex, or will it be one of the GTDI engines, like the upcoming 3.5L Ecoboost?
It is also quite a bit more exciting to look at than its closest rival, the Toyota Avalon (yawwwwn).
Friday, December 19, 2008
Note the inclusion of the UAW-busting requirements for competitive wages and work rules, but also note that these are negotiable! This means that when Obama and the more-Democrat congress are seated in 2009, they can soften the blow to the UAW, which I am sure they will try to do.
Fact Sheet: Financing Assistance to Facilitate the Restructuring of Automobile Manufacturers to Attain Financial Viability
Purpose: The terms and conditions of the financing provided by the Treasury Department will facilitate restructuring of our domestic auto industry, prevent disorderly bankruptcies during a time of economic difficulty, and protect the taxpayer by ensuring that only financially viable firms receive financing.
Amount: Auto manufacturers will be provided with $13.4 B in short-term financing from the TARP, with an additional $4 B available in February, contingent upon drawing down the second tranche of TARP funds.
Viability Requirement: The firms must use these funds to become financially viable. Taxpayers will not be asked to provide financing for firms that do not become viable. If the firms have not attained viability by March 31, 2009, the loan will be called and all funds returned to the Treasury.
Definition of Viability: A firm will only be deemed viable if it has a positive net present value, taking into account all current and future costs, and can fully repay the government loan.
Binding Terms and Conditions: The binding terms and conditions established by the Treasury will mirror those that were voted favorably by a majority of both Houses of Congress, including:
- Firms must provide warrants for non-voting stock.
- Firms must accept limits on executive compensation and eliminate perks such as corporate jets.
- Debt owed to the government would be senior to other debts, to the extent permitted by law.
- Firms must allow the government to examine their books and records.
- Firms must report and the government has the power to block any large transactions (> $100 M).
- Firms must comply with applicable Federal fuel efficiency and emissions requirements.
- Firms must not issue new dividends while they owe government debt.
Targets: The terms and conditions established by Treasury will include additional targets that were the subject of Congressional negotiations but did not come to a vote, including:
- Reduce debts by 2/3 via a debt for equity exchange.
- Make one-half of VEBA payments in the form of stock.
- Eliminate the jobs bank.
- Work rules that are competitive with transplant auto manufacturers by 12/31/09.
- Wages that are competitive with those of transplant auto manufacturers by 12/31/09.
These terms and conditions would be non-binding in the sense that negotiations can deviate from the quantitative targets above, providing that the firm reports the reasons for these deviations and makes the business case to achieve long-term viability in spite of the deviations.
In addition, the firm will be required to conclude new agreements with its other major stakeholders, including dealers and suppliers, by March 31, 2009.
There is no explicit mention of a "Car Czar", but it would seem that someone would need to be in charge of over-seeing the agreement. It isn't clear if Paulson will be the man, or if another person will be appionted to 0versee the program.
THE PRESIDENT: Good morning. For years, America's automakers have faced serious challenges -- burdensome costs, a shrinking share of the market, and declining profits. In recent months, the global financial crisis has made these challenges even more severe. Now some U.S. auto executives say that their companies are nearing collapse -- and that the only way they can buy time to restructure is with help from the federal government. This is a difficult situation that involves fundamental questions about the proper role of government. On the one hand, government has a responsibility not to undermine the private enterprise system. On the other hand, government has a responsibility to safeguard the broader health and stability of our economy.
Addressing the challenges in the auto industry requires us to balance these two responsibilities. If we were to allow the free market to take its course now, it would almost certainly lead to disorderly bankruptcy and liquidation for the automakers. Under ordinary economic circumstances, I would say this is the price that failed companies must pay -- and I would not favor intervening to prevent the automakers from going out of business.
But these are not ordinary circumstances. In the midst of a financial crisis and a recession, allowing the U.S. auto industry to collapse is not a responsible course of action. The question is how we can best give it a chance to succeed. Some argue the wisest path is to allow the auto companies to reorganize through Chapter 11 provisions of our bankruptcy laws -- and provide federal loans to keep them operating while they try to restructure under the supervision of a bankruptcy court. But given the current state of the auto industry and the economy, Chapter 11 is unlikely to work for American automakers at this time.
American consumers understand why: If you hear that a car company is suddenly going into bankruptcy, you worry that parts and servicing will not be available, and you question the value of your warranty. And with consumers hesitant to buy new cars from struggling automakers, it would be more difficult for auto companies to recover.
Additionally, the financial crisis brought the auto companies to the brink of bankruptcy much faster than they could have anticipated -- and they have not made the legal and financial preparations necessary to carry out an orderly bankruptcy proceeding that could lead to a successful restructuring.
The convergence of these factors means there's too great a risk that bankruptcy now would lead to a disorderly liquidation of American auto companies. My economic advisors believe that such a collapse would deal an unacceptably painful blow to hardworking Americans far beyond the auto industry. It would worsen a weak job market and exacerbate the financial crisis. It could send our suffering economy into a deeper and longer recession. And it would leave the next President to confront the demise of a major American industry in his first days of office.
A more responsible option is to give the auto companies an incentive to restructure outside of bankruptcy -- and a brief window in which to do it. And that is why my administration worked with Congress on a bill to provide automakers with loans to stave off bankruptcy while they develop plans for viability. This legislation earned bipartisan support from majorities in both houses of Congress.
Unfortunately, despite extensive debate and agreement that we should prevent disorderly bankruptcies in the American auto industry, Congress was unable to get a bill to my desk before adjourning this year.
This means the only way to avoid a collapse of the U.S. auto industry is for the executive branch to step in. The American people want the auto companies to succeed, and so do I. So today, I'm announcing that the federal government will grant loans to auto companies under conditions similar to those Congress considered last week.
These loans will provide help in two ways. First, they will give automakers three months to put in place plans to restructure into viable companies -- which we believe they are capable of doing. Second, if restructuring cannot be accomplished outside of bankruptcy, the loans will provide time for companies to make the legal and financial preparations necessary for an orderly Chapter 11 process that offers a better prospect of long-term success -- and gives consumers confidence that they can continue to buy American cars.
Because Congress failed to make funds available for these loans, the plan I'm announcing today will be drawn from the financial rescue package Congress approved earlier this fall. The terms of the loans will require auto companies to demonstrate how they would become viable. They must pay back all their loans to the government, and show that their firms can earn a profit and achieve a positive net worth. This restructuring will require meaningful concessions from all involved in the auto industry -- management, labor unions, creditors, bondholders, dealers, and suppliers.
In particular, automakers must meet conditions that experts agree are necessary for long-term viability -- including putting their retirement plans on a sustainable footing, persuading bondholders to convert their debt into capital the companies need to address immediate financial shortfalls, and making their compensation competitive with foreign automakers who have major operations in the United States. If a company fails to come up with a viable plan by March 31st, it will be required to repay its federal loans.
The automakers and unions must understand what is at stake, and make hard decisions necessary to reform, These conditions send a clear message to everyone involved in the future of American automakers: The time to make the hard decisions to become viable is now -- or the only option will be bankruptcy.
The actions I'm announcing today represent a step that we wish were not necessary. But given the situation, it is the most effective and responsible way to address this challenge facing our nation. By giving the auto companies a chance to restructure, we will shield the American people from a harsh economic blow at a vulnerable time. And we will give American workers an opportunity to show the world once again they can meet challenges with ingenuity and determination, and bounce back from tough times, and emerge stronger than before.
Thursday, December 18, 2008
So, bottom line, "normally bankrupcy would be best, but now is not normal. I haven't made up my mind yet what to do".
MR. DeMUTH: You'll be surprised that I have several questions about the auto bailout. (Laughter.) Let me put it in the context of this discussion. Isn't the Detroit bailout an example of interest groups thinking they can get a better deal from the executive branch than from the Congress?
THE PRESIDENT: That's an interesting way of putting it. First, let me take a step back--I haven't made up my mind yet, So you're assuming something is going to happen. (Laughter.) This is a difficult time for a free market person. Under ordinary circumstances, failed entities--failing entities should be allowed to fail.
I have concluded these are not ordinary circumstances, for a lot of reasons. Our financial system is interwoven domestically, internationally. And we got to the point where if a major institution were to fail, there is great likelihood that there would be a ripple effect throughout the world, and the average person would be really hurt.
And what makes this issue difficult to explain is--to the average guy is, why should I be using my money because of excesses on Wall Street? And I understand that frustration. I completely understand why people are nervous about it. I was in the Roosevelt Room and Chairman Bernanke and Secretary Paulson, after a month of every weekend where they're calling, saying, we got to do this for AIG, or this for Fannie and Freddie, came in and said, the financial markets are completely frozen and if we don't do something about it, it is conceivable we will see a depression greater than the Great Depression.
So I analyzed that and decided I didn't want to be the President during a depression greater than the Great Depression, or the beginning of a depression greater than the Great Depression. So we moved, and moved hard. The autos obviously are very fragile and I've laid out a couple of principles. One, I am worried about a disorderly bankruptcy and what it would do to the psychology and the markets. They're beginning to thaw, but there's still a lot of uncertainty.
I'm also worried about putting good money after bad--that means whether or not these autos will become viable in the future. And frankly, there's one other consideration, and that is, I feel an obligation to my successor. I've thought about what it would be like for me to become President during this period. I have an--I believe that good policy is not to dump him a major catastrophe in his first day of office. So those are some of the considerations that we're weighing.
What was the question on autos? (Laughter.)
MR. DeMUTH: The President-elect said--
THE PRESIDENT: Oh, you said Congress and the executive branch.
MR. DeMUTH: Yes, yes.
THE PRESIDENT: Well, just remember a majority of Congress voted for a plan that we thought was a good plan. It didn't get the requisite votes in the Senate in order to move it on, but there was a majority vote if you add up the House and the Senate. So the Congress, in one way, expressed its will for a way forward with some--with a plan, or a strategy for viability.
MR. DeMUTH: But there must be some question in your mind whether the two political branches are better at bankruptcy restructuring than a bankruptcy court. I mean, we do have a law.
THE PRESIDENT: Absolutely.
MR. DeMUTH: Do you think when everybody stops--
THE PRESIDENT: I think under normal circumstances, no question the bankruptcy court is the best way to sort through credit and debt and restructuring, no question. These aren't normal circumstances, that's the problem. This is a hard issue for political people, because people never know how bad it could have been. And so the decisions you make are easy for people to say, why did he do that? Why is he wasting our money on this? Or, why is he doing that? Because without a catastrophe, the reasoning doesn't, it just doesn't really make it down to the grassroots.
People look at, "My money being used because Wall Street got excessive." And I make the case that I didn't want to do this. It's the last thing I wanted to do. Nevertheless, I felt compelled to do it, because it would make life worse for you. We lost 533,000 jobs last month. What would another million jobs lost do to the economy? What would that do to the psychology in markets? What would that do--how would that affect the working people? And so as you can tell, we're all in, in this administration. And if need be, we'll be in for more.
Bush said basically the same thing this morning, when he announced loans from the TARP for GM and Chrysler.
For example, in the latest round of small car crash tests, the Chrysler PT Cruiser fared miserably in the IIHS side impact test, which uses a high barrier to simulate a mid-size SUV or pickup truck hitting a passenger car in the side. However, the PT Cruiser got a 4 star rating for side impact from NHTSA.
Wednesday, December 17, 2008
This shows how difficult it really is to be in the car business and build a quality product--there are more ways for cars to break than they have parts. Even starting with an existing platform (Lotus Elise), the Tesla apparently isn't ready for mass market use.
Sunday, December 14, 2008
The last few weeks, my 2wire DSL gateway (model 2701) has been behaving very badly. I can run wired all day long, no problem, but if I used 802.11b or 802.11g connections, the gateway actually drops the DSL link at random intervals. Sometimes it will run a few minutes, sometimes it will only run a few seconds.
I have googled until my eyes are dry looking for solutions, but so far, nothing concrete. Lots of people report the same sort of problem, and the only answer I can seem to find is "use a different router".
Anyone out there have the same issue?
If I find something, I'll post it here.
I have determined that the problem is with the 2wire gateway. If I use a Linksys router and turn off the wi-fi on the 2701, I have no problems, and no dropped access. My 2wire box must have an issue with running 802.11b/g and DSL.
I spoke to AT&T (India) which forwarded me to 2Wire (Phillipines). 2Wire indicated that they could not find anything wrong with my gateway. I asked them if they could arrange a replacement, and they said they normally would--but since I bought my unit second hand, the warranty does not transfer.
My solution is to use the DSL modem part of the box only, and use a separate Linksys wireless router for the wi-fi. So far so good.
So be warned, 2wire won't honor their warranties unless it is original installed equipment!
Friday, December 12, 2008
There isn't much else we can do. I urge everyone to cares about the U.S. auto industry, its suppliers, and the broad economy in general to contact President Bush right away and ask him to save GM and Chrysler, at least until Obama can get into office and take up the task.
Ronald Reagan saved Harley Davidson. I hope Bush isn't remembered as the president that killed GM.
White House telephone: 202-456-1414
White House email: email@example.com
Wednesday, December 10, 2008
From The Prince, Chapter 8 (Project Gutenberg):
Or, restated somewhat, if you must do something ugly to the people, do it quickly all at once, get it over with, so that you can start rebuilding your reputation over time by doing beneficial things gradually.Hence it is to be remarked that, in seizing a state, the usurper ought
to examine closely into all those injuries which it is necessary for him
to inflict, and to do them all at one stroke so as not to have to repeat
them daily; and thus by not unsettling men he will be able to reassure
them, and win them to himself by benefits. He who does otherwise, either
from timidity or evil advice, is always compelled to keep the knife
in his hand; neither can he rely on his subjects, nor can they attach
themselves to him, owing to their continued and repeated wrongs. For
injuries ought to be done all at one time, so that, being tasted less,
they offend less; benefits ought to be given little by little, so that
the flavour of them may last longer.
So if you are a Republican and you just lost a big election, now is the time to do damage and break things you want broken, because you have a few years before your next chance at power.
Here's the video: CNBC
The Southern Republicans are determined to bust the UAW. Here is the outline of their plan. An excerpt (red text is my emphasis):
What We Should Be Doing: The American Automotive Reorganization and Recovery PlanSo they are basically saying, 1) break the UAW, and 2) soak the creditors, while offering a 50% insurance policy against default to try to attract private investment.
On December 2, the Big Three presented to Congress their plans for restructuring. While the plans included laudable goals, too few details were provided ...
The Big Three must lock in the restructuring they have promised in a matter of weeks, not months or years. Congress should instead establish firm benchmarks and a tight timeline for restructuring. Such benchmarks will include for example requiring that by March 31, 2009 each company should reach agreement whereby:
•The companies’ creditors agree to a framework to reduce each company’s indebtedness by at least 1/3.
•The UAW holds to concessions already made and further:
o Concedes the elimination of Supplemental Unemployment Benefits;
o Concedes elimination of the Jobs Bank Program;
o Agrees to either reduce company retiree health care obligations or otherwise convert a portion of such obligations into equity; and
o Agrees to reduce wages and benefits to the levels paid by non-Big Three manufacturers.
A Process for Reaching Expedited Agreement, Instead of Nationalizing America’s Auto Companies
Because of the many legal and contractual hurdles to restructuring, the companies are urged to accomplish their restructuring through the use of a pre-packaged bankruptcy or another mechanism to bring all stakeholders to the table for an agreed-upon determination of their future. It is important that these stakeholders reach reasonable compromises amongst themselves. Creating a government bureaucracy or a “car czar” to arbitrarily pass judgment on the thousands of details involved with a restructuring is akin to nationalizing the auto companies.
Interim Financing: Insurance, Rather than a Taxpayer-Funded Bailout
The Big Three may need some form of interim financing as they finalize their restructuring. In normal economic times, if their restructuring plan is considered viable, such financing should be available in the private market. Because of the current credit crisis, limited assistance may be appropriate in the form of insurance, rather than a taxpayer-funded government bailout that replaces private investment. We propose that the government provide insurance, funded by the participants with a modest FDIC-like fee, which would cover up to 50 percent of the losses of new investment in the case of default, helping to unlock immediate private investment (not unlike debtor in possession financing). Such insurance would expire on March 31, 2009. This proposal ensures that taxpayers are protected and provides a powerful incentive for the Big Three to quickly implement their restructuring plans.
It's the "private investment" part that worries me.
Saturday, December 06, 2008
The whole mass has been a fascinating, and depressing political show. I listened to a few hours of the hearings over the last few days, and pompous arrogance of some of the members of Congress was infuriating. Even the sympathetic members, such as Chris Dodd (D-CT) offered ridiculous and unhelpful advice, such as suggesting with a straight face that maybe the Detroit 3 could retool their plants to build mass transit products such as busses and rail cars. "The truck and SUV plants you are closing... these have pretty long wheel bases, don't they?" said Dodd, who apparently acquired a manufacturing engineering degree somewhere, secretly.
Then came the spectacle of Maxine Waters (D-CA) complaining that dealers, specifically small dealers, specifically, minority dealers, were being hurt by all the cuts, and inquiring what the Detroit 3 were planning to do to protect the dealers. This at a time when many commentators, and many other members of Congress correctly realize that having too many dealers their hurts profitability, and reduces the efficiency of the service and distribution divisions.
But the most delicious part of the political battle, for me, was the brawl between Bush and the Democrats on where to take the loan money from. Bush said from the beginning that the financial bailout money ($350 Billion now, $350 Billion later, maybe) was for protecting the financial system, and that Congress should rewrite the Advanced Technology Manufacturer Vehicle Assistance Program (aka "section 136") law to allow that money to be used for bridge loans. The Democrats wanted Bush to use money from the financial bailout money, and to save the ATVM loan program for fuel economy retooling.
Bush stuck to his guns (he is very good at it) and forced the Democrats to make a painful choice: do nothing, and throw the UAW under the bus, or cave, and anger the Greenies. From the Detroit Free Press:
A breakthrough on the long-stalled rescue came when House Speaker Nancy Pelosi yielded to President George W. Bush on a key point: allowing the aid to be drawn from a fund set aside for the production of environmentally friendlier cars.And, at the 11th hour, the Democrats wisely decided it was the Greens who should be thrown under the bus.
May it always be so.
Wednesday, December 03, 2008
So I went and looked at Ford's sales number details for Lincoln, on Ford's media web site.
Towncar had better year-over-year results than Subaru Forester (+63%) or BMW's Mini (+43%). I didn't take the time to dig through the other car maker's sales numbers, but I am willing to bet that no single model had a better year-over-year result than Towncar.
I wonder what Ford did to sell them like that... BOGO?
The pundits were predicting that GM would have no choice but to plan to cut brands, and so it wasn't a surprise that they announced, effectively, the end of Pontiac and Saturn. We don't know what a "niche brand" Pontiac will look like, but it might be limited to roadsters and Australian transplants.
Saturn is probably just dead, because there isn't much there to sell. When Saturns were assembled at their own plant, it may have worked, but now that they are variants of other GM models, built in shared plants with shared parts, it doesn't seem like there is much to sell. "Strategic options" seems to me like it means that Saturn will be put down like Oldsmobile.
I wrote 3 years ago that GM should kill Pontiac and keep Buick, you can read the earlier post here. And GM did some things to improve Pontiac, by bringing out the audacious Solstice, and the G8, and the upcoming Sport Truck. But they also shot themselves in the foot with such decidedly unexciting vehicles as the G3, G5, and Torrent. The G6 is a handsome car that just needs some sportier tuning, in my opinion. The Vibe has the same problem--it is a decent car, very practical, but not very exciting to drive.
Saturn is unfortunate, because GM worked very hard to give them a sharp, well defined character and fresh products. The Aura won NA Car of the Year with its sharp looks and much improved interior. The Astra, a Euro transplant, is also a sharp car with good handling. But somehow, the brand just couldn't take off.
I hope GM recycle's the Saturn dealer network, because they are what gave Saturn half a chance to begin with. I shopped for one once, and I liked how I was treated.