Submitted by Yi-Wyn Yen02.26.2009
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This prediction is closed and has been judged.
Judgment made on April 3, 2009: The Obama administration denied additional bailout money to GM and Chrysler. Both troubled carmakers received an extension to restructure their businesses and will receive "working capital" to stay afloat. The amount was not disclosed. Despite the cash infusion the companies will receive, the intention of this prediction is to address whether or not GM and/or Chrysler received additional TARP funding by March 31. After much consideration, the Standard has determined that "working capital" is not considered part of TARP funding, therefore this prediction receives an unfavorable judgment. -- The Industry Standard
General Motors and Chrysler are in serious trouble. The two companies received $17.4 billion in federal funding last year from the U.S. Treasury and in February, requested another $22 billion to survive.
In its fourth quarter earnings, GM reported losses of nearly $31 billion in 2008, or a whopping $85 million a day. There is growing concern that GM will not able to continue running its business even with its restructuring goals. GM has said that it could run out of money by March without another cash infusion.
A recent poll conducted by USA Today and Gallup says that 75% of Americans don't support a bailout for the troubled automakers. A growing American sentiment that would rather see GM and/or Chrysler go bankrupt than receive more funding will make it more difficult for President Obama's auto task force to approve another bailout.
Prediction: General Motors and/or Chrysler will receive another federal bailout by March 31, 2009. An announcement that one or both companies get an approval will result in a favorable judgment.
Price History
Prediction Statistics
| Betting Closes: | Mar 30 2009 | Current Consensus: | 43.78% | Total Bets: | 50 |
| Today's Change: | 0% | ||||
| Life Time High: | 85.20% | ||||
| Life Time Low: | 10.43% |
Comments
US Treasury agrees to provide a $1.5B loan to Chrysler to assist with purchase of vehicle from Chrysler.
Official document from US Treasury can be found here.
Does this not count as a NEW federal support to render favorable judgment.
Obama and entourage will be visiting with automakers next week to review recent loans and potential new loans.
I think the last article you posted suggests that we need to watch this closely before making a rash decision to close this prediction.
Absent of any decisions from the Obama visit with automaker, the $1.5B loan (1st comment) is already a reality.
According to this article
The final plan will serve as a basis for the Treasury's decision, due by March 31, on whether to extend the loans or call them in and comply with some requests to allow the companies to collapse.
Administration officials are expected to study the auto industry plans for several weeks before deciding a course of action.
More aid likely according to members of task force with decision by March 31.
Looks like announcement will be made on March 31 before Obama leaves for the Group of 20 meeting in Europe.
White House Plans More Aid To Automakers
Details of plans are trickling in, set to be announced tomorrow
The Obama administration plans to give General Motors Corp. enough government aid to restructure over the next 60 days, while Chrysler LLC will get up to $6 billion and 30 days to complete an alliance with Italian automaker Fiat SpA.
А что думают на эту тему Русские мои односельчане?
Doesn't look good ....
Obama denies bailout funds for automakers
and
Autos Task Force Rejects GM, Chrysler Plans
Technically, this is a favorable judgement right? Not the bailout we were expecting but continued aid all the same.
GM, which will continue to receive an undisclosed amount of government aid as it develops a new plan over 60 days, will get greater guidance from the Treasury and outside advisers in the process than previously, according to the administration. The government was silent on how much more aid GM may receive if it devises a successful plan.
@Marc, I strongly disagree. This is not termed as a bailout. Task Force rejected the Plans from GM and Chrysler. The spirit of the prediction was for approval for additional bailout funds being appropriated. It is very clear in the statements from the White House and the result from the Task Force that additional bailout funds are not to be appropriated at this time. Any such approval is subject to GM reworking its restructuring plans (within 60 days) and Chrysler completing its alliance with Fiat (within 30 days). Both of which will be PAST the judgment criteria date.
@TIS, I recommend serious consideration be made to ensure that the spirit of the prediction is not violated during judgment.
Official text of Obama remarks ...
But after careful analysis, we have determined that neither
goes far enough to warrant the substantial new investments that
these companies are requesting. And so today, I am announcing
that my administration will offer GM and Chrysler a limited
period of time to work with creditors, unions, and other
stakeholders to fundamentally restructure in a way that would
justify an investment of additional tax dollars; a period
during which they must produce plans that would give the
American people confidence in their long-term prospects for
success.
@ David, the following is from CNN. If the government is going to give adequate working capital for GM and Chrysler, how is that not a "bailout"? We are not talking about a couple of bucks here that you or I can pull out of a wallet. We are talking about billions even for sixty days.
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President Obama announced Monday that struggling automotive giants General Motors and Chrysler will be given a "limited" period of time to "restructure in a way that would justify an investment of additional taxpayer dollars." President Obama announced his plans for troubled U.S. automakers on Monday.
President Obama announced his plans for troubled U.S. automakers on Monday. The federal government will give GM "adequate working capital" over the next 60 days to work in conjunction with the administration in developing a better recovery plan, he said.
Chrysler will be given adequate capital to continue operations for 30 days while completing a merger with automaker Fiat.
@Yi-Wyn Yen, as you have been suggesting a number of the best and most active predictions, you can see the reason we need to have extremely tight predictions. Had there been a dollar threshold, we could probably figure this out eventually. Otherwise, a case for or against can legitimately be made. We may need to let the TIS Supreme Court decide this one.
@Marc, I still disagree.The prediction is primarily focused on bailout and it is very clear that decision is not to grant additional bailout funds until the new deadline (60 days for GM and 30 days for Chrysler). The spirit of the prediction will not have been met by tomorrow and as such should be judged UNFAVORABLY.
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