Tuesday, December 21, 2010

Difficult becomes impossible

Remember when I said I'd never buy a GM vehicle because "our" government had stolen the company from it's rightful owners, and that sentiment went for Chrysler as well?

Now I have to wonder if Ford should be off the table as well. Even more importantly, why was Ford not stolen in the same way as GM and Chrysler?

There are entirely too many questions and too few answers. At least I can be fairly certain that the free market isn't any longer.

1 comment:

Bob H said...

There is a huge difference between the Ford borrowing and the GMAC/Chrysler bailout. That article looks like someone is trying to make Ford look as bad as GMAC/Chrysler.
Fords auto-lending arm borrowed from the Federal Reserve just as GM and Chrysler did, because the capital markets weren't lending. Ford Motor Credit and the GMAC/Chrysler lending arms had to do the same thing because they had nowhere to sell their loans. They would sell a portion of their loans to fund future car buyer loans.
GMAC/Chrysler then borrowed 10s of billions more to fund operations in exchange for stock and protecting the unions, while screwing the bondholders. Ford did no such thing. Ford also quickly repaid the loans when the capital markets unfroze.