Also, it's the one year anniversary of <a href="http://calculatedrisk.blogspot.com/2007/08/cramer-goes-crazy.html>Cramer Goes Crazy (not the Seinfeld one)

OT

"One Day In The Life Of Ivan Denisovich"

Alexandre Solzhenitsyn dead at 89.

Although I never met him, he was my friend.

Da svedanya, Sasha Y paka.

Yeah rich, but, excess supply relative to demand means inflation because, ya know... gold is money... er someting

So does Cerberus, er.. Chrysler have $6 billion in cash to pay off the unrenewd portion of this st debt? If not who did they just stiff?

ice sunset tonight...anyone else watching?

hmmm. same comment posted twice...wasn't me

spent the day at the beach with the kids...sat on deck, glass of wine
in hand, watched sun set over the ocean.

now am suddenly stressed about frickin chrysler.

Chrysler should have been allowed to fail back in 1980. Intervention never works.

Chyrsler will be bankrupt in 12 months...book it!

Can't see Tata having any interest...guessing they've got hands full digesting/integrating Jaguar and Land Rover. If not for that, they MIGHT be interested in (a?) "Hummer".

crispy&cole writes:
Chyrsler will be bankrupt in 12 months...book it!

I wouldn't be surprised if they went out in Sept... with a whimper and a whine for a bailout from Congress. TBTF esp in an election year. Without leases and financing who would outright buy a Chrysler?

now am suddenly stressed about frickin chrysler.
are you kidding me | 08.03.08 - 11:45 pm |

the only reason you should be stresed about chyrsler is if ernest gallo decides to turn his pinot field into a parking lot for excess ram1500 production.

In a few years a Hummer will be one of CSC's names for working girls in Laos.

mock turtle,

Actually, I don't think they actually have a "brand" under that name....sorta like "General Motors". They're the firm that introduced the Nano at the Geneva Show this year. A high-tech micro car for $2500 (for emerging markets only, at that price).

when chryler gets bailed out i still think their come-back car ought to be called the bernanke

Bernanker put...putt-putt.

There is also an array of items buried deep in the legislation, and the implications of some of them is not yet clear. There are provisions, for example, that grant or extend Section 8 federal housing subsidy eligibility to residents of specific properties in Malden, Mass., and San Francisco. And there is a provision tailored narrowly for Chrysler to ensure that it can benefit from a corporate tax incentive even though the company is now structured as a partnership not a corporation. The bill does not name Chrysler but rather describes an unnamed automobile manufacturer “that will produce in excess of 675,000 automobiles” between Jan. 1 and June 30, 2008.

Chrysler/Cerberus have a massive tax break heading their way

That just means they keep losses off their books doesn't make them cash flow positive.

SEC is looking at extending their protective blanket over the entire market after Aug 12...

MiTurn,

Was GOING to say "ash"..it was rattling around in the memory banks, but wasn't a 100% certain. Recycled cricket bats, maybe?....G.

What would you do if I sang out of tune,
Would you stand up and walk out on me?
Lend me your ears and I'll sing you a song
And I'll try not to sing out of key.

Anonymouse writes:
Here's an artist's rendering of the Nano, for those interested"

sweet, I want one!

Have you ever had knackwurst? Damn, that's a fine hot dog.

The Banks and Private Equity
Dollars & Sense blog: The Banks and Private Equity | Dollars & Sense

Private equity firms say they are ready to invest huge amounts in ailing banks — provided the Fed eases up on the regulations that would otherwise apply to such large investments. The firms’ desire to jump in makes perfect sense. Bank shares are cheap now, but for the most part, are likely to rebound when the economy improves. The firms’ push for easier rules, however, is a dangerous power grab, and should be rejected.

As Financials Go, So Go Stock Markets
As Financials Go, So Go Stock Markets -- Seeking Alpha

Traders speculated that the latest capital raise was a sign that the worst was over for financials, but Meredith Whitney, analyst of Oppenheimer & Co and “godmother” of financials, had no illusions and said in an interview that 25 institutions would have to bolster their balance sheets within the next two months.

Offering some reprieve to the financial sector, the Fed, together with the European Central Bank and the Swiss National bank, announced that “emergency” lending facilities to bolster the money markets would stay in force until January 30. The facilities were implemented to improve liquidity arising from the credit market turmoil.

Goldman, JPMorgan Sell Bonds in Europe as U.S. Yields Soar Goldman, JPMorgan Sell Bonds in Europe as U.S. Yields Soar - Bloomberg.com

U.S. bondholders raised yields for financial companies to the highest relative to Treasury notes in at least a decade as bank losses and writedowns on debt securities reached $480 billion worldwide since the collapse of subprime mortgages last year. Yields on bank bonds in dollars are 269 basis points higher than the benchmark mid-swap rate, or 7.1 percent, whereas in Europe the spread is 202 basis points, or 6.4 percent, according to Merrill Lynch & Co.'s Financial Corporate indexes and Bloomberg data.

Confidence among investors in banks and brokers has been more eroded by the credit crisis in the U.S. than in Europe and that has pushed up the cost of borrowing there,'' said Nathalie Deliens, a bank analyst at Societe Generale SA in London.In Europe, demand for bank paper has remained strong.'

The US is a short across the board. Enough said.

NEW YORK, Aug 3 (Reuters) - Chrysler LLC's finance arm said on Sunday it had renewed its credit facilities, but had reduced the amount to $24 billion from $30 billion due to tough credit markets and changes in its retail strategy.

Chrysler Financial said 90 percent of all banks that were part of the original financing participated.

Citigroup , JPMorgan Chase and Royal Bank of Scotland , led the syndication of the loan facilities.

Chrysler Financial will use the credit facility as a source of funding to make loans to Chrysler dealers financing inventories of unsold vehicles in showrooms and to make loans to consumers financing vehicle purchases.

Those loans are then typically bundled up and sold to investors in the asset-backed securities market.

Last month, Chrysler, which is majority-owned by private equity firm Cerberus Capital Management [CBS.UL], said the financing arm would stop offering vehicle leases.

On Friday, the auto maker said the decision to suspend lease financing, a risky form of vehicle financing that has saddled Chrysler's U.S. rivals with large losses, had been a positive move in negotiations with its bank syndicate.

Chrysler did not specify the interest rate it was paying on the financing.

But the Wall Street Journal reported that the company would pay interest rates of 1.1 percentage points to 2.25 percentage points over Libor on different parts of the funding, compared to 0.3 percentage point to 0.5 percentage point over Libor on the facilities raised a year ago.

Chrysler Chief Financial Officer Ron Kolka said on Friday the financing cost would be higher because of the tighter credit markets.

Chrysler Financial spokesman Bill Porter said $24 billion raised in the refinancing was sufficient because of the company's decision to abandon lease financing.

In lease financing deals, automakers and affiliated finance companies essentially rent cars and trucks to consumers, typically for terms of about three years.

The setup allows consumers to buy bigger and more expensive vehicles than they would otherwise because it keeps monthly payments low, sometimes at rates subsidized by the automakers.

But the sharp decline in the popularity of SUVs and trucks in recent months has exposed the risk of lease financing for automakers, who have been forced to sell vehicles coming off lease for as much as 25 percent less than they had forecast.

The result in recent months has been losses of thousands of dollars for every SUV and truck sold on a lease contract.

Chrysler, which is only liable for the leases it wrote in the year since it was purchased from Daimler AG by Cerberus, was the first major automaker to pull away from vehicle financing.

Like its larger competitors General Motors Corp and Ford Motor Co , Chrysler has faced scrutiny over its ability to ride out a downturn in U.S. auto sales that many analysts expect to stretch through 2009.

GM has said it expects to cut its lease financing by about half, to near 9 percent of sales. Ford has said it will take steps to limit its risks from lease financing through steps that will make the option more expensive for consumers.

All three U.S. automakers have been hit hard by the sharp decline in sales of pickup trucks, SUVs and vans that followed the rise in gas prices this year.

Chrysler sales are down 23 percent through the first seven months of the year.

The company, which has released limited financial data since going private a year ago, said last week it ended June with $11.7 billion in cash and had earnings before interest, tax, depreciation and amortization of $1.1 billion in the first half of the year.

Chrysler officials said those figures were a sign of strength given the pressure on the U.S. auto industry, now in its third year of declining sales.

69 Visitors Online

but more to the point, he said he and his son drove back thru canada and saw, and toured, a number of gleaming, new automotive plants that stood in stark contrast to the rotting hulk of deserted us factories they saw earlier in the trip

just a story...no proof no stats.
mock turtle | 08.04.08 - 12:17 am | #

well I'll see you that and raise you.......

Between April, 2006, to April, 2008, Ontario lost 130,000 manufacturing jobs, compared with 64,000 in Quebec, 18,000 in British Columbia and a zero net loss in the rest of the country. Since 2002, the province has lost 215,000 manufacturing jobs.

this.

I don't know what was in that fellow's pipe but for your information Ontario's economy is sucking the hind tit right now. I haven't heard of any shiny new auto plants there for a long time. Quite the opposite actually.

Financial Post Story

CR,
I know you won't read this because it is too late, but wasn't there some suspicious funding for Chrysler in the 300 billion dollar taxpayer boondogle.

Trickle Down and Sink In
http://top.czm.cn/index.php/article/machinery/2008-08-04/171.html

Yesterday, the National Australia Bank stated it will write down 90% of the "value" of its US housing-related paper. If pension funds in the US and around the globe would follow the NAB’s example, trillions of dollars in assumed value would vanish overnight. Still, whether they recognize it publicly or not, the paper is worthless, and there’s no realistic prospect for it to regain -any of- its value.

So there goes your pension.