Auto sales are down, many people in the country feel that we are in/entering a recession, and these guys think they'll be able to sell debt in an auto company? Chrysler no less?
If they couldn't move this stuff in the summer, when people still believed things were OK, how do they imagine that they'll be able to sell this debt now?
Why, sure they are.
First they were selling hams and fresh pork chops. Now they're selling sausages and cold cuts.
In six months they'll be pushing canned ham and potato soup. (Everything but the oink is for sale, right up til it's all gone. "Greatest stuff in the world" is what they're selling, but you notice they don't want to buy any.)
Not sure there is a market clearing price for this one. Too many moving parts operationally, too many questions for the overall economy, too many reasons for a buyer to stay away. We may have to reclassify this particular deal from a pier to a leaky houseboat.
No surprise: the US auto companies are rolling out big gas guzzling trucks.
The last gasp. At least C's latest offering in that category is much improved. Perhaps that's why the loans are getting shopped again right now (never mind that deliveries won't happen for another 7 months).
If they couldn't move this stuff in the summer, when people still believed things were OK, how do they imagine that they'll be able to sell this debt now?
For the same reason the VC's in Silly.con valley in the summer of 2000 were so upbeat and confident that as soon as the "storm passed" in a month or two, they'd be back on the floor of the Nasdaq watching their Rathole.com go public. They've confused a bull market with genius for so long that the notion of a secular bear market doesn't fit into their worldview. And, consequently, gets ignored.
Now, I personally would define "persistently upbeat in the face of mounting evidence to the contrary" as "delusional", not "opportunistic" ... but, hey, I guess that's why I'm not a chairman of capital markets origination.
"The CEO calling his own company operationally bankrupt probably did not help the cause."
That was no ordinary CEO, it was the Genius of Home Depot, good old Bob Nardelli. I suppose he has fired all the old time techs there and replaced them with part timers.
I wonder how they plan to blame THIS on the workers, their health plan, and the union. Because, trust me, they'll find a way.
Riggsveda-
I'm waiting for the same thing. Why is it that when a company succeeds, it's because of the "visionary CEO, the superior management, blah blah blah", but when a company fails, it's because of the "lousy workers, greedy unions, overstuffed pension plans, and high health care costs."
Last I checked, every other developed country in the world manages to provide universal health care, respectable pensions in old age, and economic security, while still competing in the marketplace. Yet all we Americans get for the economic insecurity and downwardly mobile wages that we face is a bunch of bankrupt corporations and financial companies that are excellent at dis-earning $24 billion dollars in a quarter.
Count me among the populists waiting with pitchfork in hand.
Tata Motors could clear this... buy it, toss out everything but one assembly line and the dealer network. Sell Jeeps and the Nano People's car. Even at double the South Asian price ($2,500 there, $5K here ?) they would sell like hot glazed doughnuts at a law enforcement convention.
Re: Tata Motors could clear this... buy it, toss out everything but one assembly line and the dealer network. Sell Jeeps and the Nano People's car. Even at double the South Asian price ($2,500 there, $5K here ?) they would sell like hot glazed doughnuts at a law enforcement convention.
RayOnTheFarm | 01.14.08 - 3:25 pm | #
Tata Motor's Nano will never ever meet North American emission and safety standards. Chrysler's biggest problem right now is that the things it makes well (big rear-drive cars and trucks) are not things that many people want. Their Neon replacement doesn't get particularly good mileage either. Their partnership with Mitsubishi isn't looking so hot now that the Japanese firm doesn't have any good small cars either.
Has anyone seen an update on how much of the $300 billion of loan commitments that banks had outstanding last fall related to takeovers remain to be sold?
move along, nothing to see, no piers here.
Ya I saw that myself - wondered what makes it different this time? Probably nothing... unless maybe now Chrysler is known to be in worse shape.
Bad dog, Cerberus. KKR gets a treat for running away from HAR, though.
January is not "welcoming". Did Bill Clinton write that?
The CEO calling his own company operationally bankrupt probably did not help the cause.
Cheers,
prat
Maybe the Chinese will save them...
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If the loans won't sell, the price is too high. What is hard to understand about that? Do what Wal*Mart would do and hold a sale.
Jim
"Maybe the Chinese will save them..."
Not if they actually take a few Chryslers out for a drive...many of them are miserable.
Really a shame. Chrysler could have made an interesting comeback, but I predict that the only thing left in a few years will be the Jeep brand.
Daimler, after somehow dumping the turkey of the century, must be beside themselves with joy. Hail Cerberus!
OT -- please, no one spook Sebastian, but Q4 earnings are not off to a good start, down 22-26% year over year.
The Wall Street Journal Online - WSJ.com Log In
oh I doubt Daimler is happy, they're still smartign for overpaying for Chrystler when they bought them.
As for the Chinese, they want Chrystler nto for any of their products but for the brand and more importantly it's (bloated) dealer network.
Auto sales are down, many people in the country feel that we are in/entering a recession, and these guys think they'll be able to sell debt in an auto company? Chrysler no less?
If they couldn't move this stuff in the summer, when people still believed things were OK, how do they imagine that they'll be able to sell this debt now?
Banks Still Trying to Sell Chrysler Debt
Dealers Still Trying to Sell Chrysler Cars
Why, sure they are.
First they were selling hams and fresh pork chops. Now they're selling sausages and cold cuts.
In six months they'll be pushing canned ham and potato soup. (Everything but the oink is for sale, right up til it's all gone. "Greatest stuff in the world" is what they're selling, but you notice they don't want to buy any.)
I wonder how they plan to blame THIS on the workers, their health plan, and the union. Because, trust me, they'll find a way.
Detroit Auto Show is in progress. No surprise: the US auto companies are rolling out big gas guzzling trucks.
Oh yeah. There's a genius idea.
"JPMorgan Chase, Citigroup and Goldman Sachs, are still trying to syndicate the loans."
syndicate, launder....semantics.
Not sure there is a market clearing price for this one. Too many moving parts operationally, too many questions for the overall economy, too many reasons for a buyer to stay away. We may have to reclassify this particular deal from a pier to a leaky houseboat.
No surprise: the US auto companies are rolling out big gas guzzling trucks.
The last gasp. At least C's latest offering in that category is much improved. Perhaps that's why the loans are getting shopped again right now (never mind that deliveries won't happen for another 7 months).
"We may have to reclassify this particular deal from a pier to a leaky houseboat."
Someday Chinese Junk?
If they couldn't move this stuff in the summer, when people still believed things were OK, how do they imagine that they'll be able to sell this debt now?
For the same reason the VC's in Silly.con valley in the summer of 2000 were so upbeat and confident that as soon as the "storm passed" in a month or two, they'd be back on the floor of the Nasdaq watching their Rathole.com go public. They've confused a bull market with genius for so long that the notion of a secular bear market doesn't fit into their worldview. And, consequently, gets ignored.
Now, I personally would define "persistently upbeat in the face of mounting evidence to the contrary" as "delusional", not "opportunistic" ... but, hey, I guess that's why I'm not a chairman of capital markets origination.
"The CEO calling his own company operationally bankrupt probably did not help the cause."
That was no ordinary CEO, it was the Genius of Home Depot, good old Bob Nardelli. I suppose he has fired all the old time techs there and replaced them with part timers.
I wonder how they plan to blame THIS on the workers, their health plan, and the union. Because, trust me, they'll find a way.
Riggsveda-
I'm waiting for the same thing. Why is it that when a company succeeds, it's because of the "visionary CEO, the superior management, blah blah blah", but when a company fails, it's because of the "lousy workers, greedy unions, overstuffed pension plans, and high health care costs."
Last I checked, every other developed country in the world manages to provide universal health care, respectable pensions in old age, and economic security, while still competing in the marketplace. Yet all we Americans get for the economic insecurity and downwardly mobile wages that we face is a bunch of bankrupt corporations and financial companies that are excellent at dis-earning $24 billion dollars in a quarter.
Count me among the populists waiting with pitchfork in hand.
Tata Motors could clear this... buy it, toss out everything but one assembly line and the dealer network. Sell Jeeps and the Nano People's car. Even at double the South Asian price ($2,500 there, $5K here ?) they would sell like hot glazed doughnuts at a law enforcement convention.
Re: Tata Motors could clear this... buy it, toss out everything but one assembly line and the dealer network. Sell Jeeps and the Nano People's car. Even at double the South Asian price ($2,500 there, $5K here ?) they would sell like hot glazed doughnuts at a law enforcement convention.
RayOnTheFarm | 01.14.08 - 3:25 pm | #
When I first saw this, I read "Tanta Motors"!
Maybe next year.
Tata Motor's Nano will never ever meet North American emission and safety standards. Chrysler's biggest problem right now is that the things it makes well (big rear-drive cars and trucks) are not things that many people want. Their Neon replacement doesn't get particularly good mileage either. Their partnership with Mitsubishi isn't looking so hot now that the Japanese firm doesn't have any good small cars either.
lune---
Huzzah!
Has anyone seen an update on how much of the $300 billion of loan commitments that banks had outstanding last fall related to takeovers remain to be sold?