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General Motors to invest $540 mln in Central Mexico - Autos & Trends (http://www.ibtimes.com/articles/103400/20110121/gm-mexico.htm)


By IBTimes Staff Reporter | January 21, 2011 2:13 AM EST

General Motors will invest $540 million to build fuel-efficient engines at its plant in central Mexico.
General Motors to invest $540 mln in Central Mexico



General Motors de Mexico said the first phase of the project at its plant in Toluca involves the production of aluminum parts, and the second phase the manufacture of four-cylinder, 1.6-liter and 1.8-liter engines, mostly for cars produced in Mexico.

GM has four plants in Mexico, and has invested some $5 billion here since 2006.

The auto major was left reeling under the industry slump when the global economic crisis hit. It received 49.5 billion dollars from the US Treasury and emerged from a bankruptcy restructuring in 2009. It successfully returned to public trading in November 2010 by raising 23.1 billion dollars in an initial stock offering - the largest in history.

That settles it....my next truck will be a Ford. Chevy had almost won me over but I don't like their interior enough to support GM.

After having a Toyota then a Honda that both ran flawlessly and gave me over 250K miles each, I finally gave a General Motors car a chance before they were Government Motors, and it is much MUCH less dependable. The next time I buy a car, it's going to be from a part of the world that caters to consumers instead of labor unions. Buy American is a nice slogan, but we consumers are Americans too.

That settles it....my next truck will be a Ford. Chevy had almost won me over but I don't like their interior enough to support GM.

Not thrilled with any of the three local dealerships for any sort of service with my Ford Explorer....
I was thinking GM next but this just makes you think.... Go figure....
My wife's Acura has been great so far.... hmmm.....

My wife's Acura has been great so far.... hmmm.....

Yep, you'll hear this type story over and over and over again.

General Motors to invest $540 mln in Central Mexico - Autos & Trends (http://www.ibtimes.com/articles/103400/20110121/gm-mexico.htm)

This is the freemarket economy at work. :rolleyes:

It's what happens when the government throws dump truck-loads of money at a company, but places no restrictions on how they can or can not use it.

This is the freemarket economy at work. :rolleyes:

It's what happens when the government throws dump truck-loads of money at a company, but places no restrictions on how they can or can not use it.

First of all, there is nothing free-market about any of this Curtsie, Sir. All the "free-marketers" are rolling in their graves about this.

Secondly, when someone says "free-market," they don't mean complete free-market, they mean leaning primarily to free market. Or at least peole grounded with real business experience think that. And I'm one of them. I believe in government intervention at times and I believe in a certain amount of regulation. In fact, the financial crisis we just went through? Well, the regulations were pretty much already there...it's just that people didn't use them....including ironically enough, the liberally dominated Fannie Mae and Freddie Mac, as well as the conservatives at SEC and in other regulartory positions. I believe in a certain amount of regulation but not the extremes we've gone to (i.e. my window screens have a sticker that says warning: death may occur if you fall through them.)
Adding a whole lot more regulations now is not correcting the problem. Like I said, plenty of regulations were already in place.

The root of the financial crisis is the root of the same problems I see all over the place in corporate America and in the federal government - there's a crisis of integrity in this country - people who will not speak up or step up when they know something is wrong.

Here's a really good book I recommend for understanding not just the financial crisis but just about everything about our economy. It's written by two somewhat liberal leaning business journalists (which means I was shocked that I agreed with them) by the names of Bethany McLean and Joe Nocera entitled, "All The Devils Are Here." It's the best book in the entire financial section of the bookstores.

They posit that the blame for the financial crisis falls on everyone: Wall Street, Main Street, Pennsylvania Avenue, greedy traders (though I want my traders to be aggressive so I don't want that to change), misguided regulators, sleazy subprime companies, cowardly legislators, and last but not least, the home buyers who failed to act responsibly either.

One of the hearts of the problem was the reliance on the rating agencies (i.e. Moody) by Wall Street. In the past, when Moody said something was AAA rated, Wall Street never had a need to question it....but it turns out that's one of the significant contributors to the crisis because the ratings became unreliable (i.e. integrity issue!!).

But back to GM, I think we need to let failing enterprises fail. I don't care how big. If we followed our anti-trust policies better, entities wouldn't be allowed to get "too big to fail" anyway. Therefore I don't think we should throw truck loads of money on these losers to begin with, so placing restrictions would be moot.

Not thrilled with any of the three local dealerships for any sort of service with my Ford Explorer....
I was thinking GM next but this just makes you think.... Go figure....
My wife's Acura has been great so far.... hmmm.....

My neighbor traded in his Ford and went with a Chevy because of bad service at Ford. I have had a few people tell me good things about a local Chevy dealership. I stopped in once just to look and thought their serivce was pretty good. Looks like its the old "between a rock and a hard place" decision.

General Motors to invest $540 mln in Central Mexico - Autos & Trends (http://www.ibtimes.com/articles/103400/20110121/gm-mexico.htm)

This is why the GM bailout had nothing to do with saving American jobs. It had everything to do shoring up the Union pensions and paying back union political support. it would have been cheaper and more cost effective just to shore up the pensions and move on.

My biggest complaint was how they created the new company. They basically bought the assets in one piece from the bankrupt company at a level that left creditors out in the cold. The new company is/was owned by the government and the taxpayers basically gave UAW 20% of the value for nothing. UAW should have been lumped in with all the bondholders/creditors and received their fair share based on the ratio owed them. That's how they would have been treated in a liquidation. Instead they got a sweetheart deal.

Now Ford UAW workers are mad because their health plan didn't get the windfall that GM UAW workers got. I'm waiting for the administration to float a proposal to give Ford UAW workers an quivalent windfall in the interest of fairness. It wouldn't surprise me to see the government offer a special sale of GM stock to Ford UAW at a fixed price below market.

I haven't owned a GM product in 11 years. My last one was a 99 Grand Prix, although I have owned several other Chevy products. I swore off them when I noticed I was in the dealership every three or four months for warranty work. That Pontiac was replaced with a Ford the wife is still driving.

A couple things irked me with the whole bailout thing. The reason the companies were having problem is there wasn't enough demand for their product coupled with a general slow down in the market. The government bailed the companies out which left an excess supply in the marketplace. This will not result in a healthy market. Prices will remain low and profits will remain difficult to earn. GM was giving donations to politicians before they had paid back their bailout. If they didn't have the money to pay back the government they should not be giving money away. And obviously the fact that once in a better position they invest in another country is very irritating.

First of all, there is nothing free-market about any of this Curtsie, Sir. All the "free-marketers" are rolling in their graves about this.

About GM investing in manufacturing in Mexico after being bailed out by American taxpayers?

How can that be? I'd go so far as to say most of the recipients of bailout money misused it in one way or another. AIG was a prime example. The US government gave the banks vast quantities of money with few, if any, restrictions on it's use.


Secondly, when someone says "free-market," they don't mean complete free-market, they mean leaning primarily to free market. Or at least peole grounded with real business experience think that. And I'm one of them. I believe in government intervention at times and I believe in a certain amount of regulation. In fact, the financial crisis we just went through? Well, the regulations were pretty much already there...it's just that people didn't use them....including ironically enough, the liberally dominated Fannie Mae and Freddie Mac, as well as the conservatives at SEC and in other regulartory positions. I believe in a certain amount of regulation but not the extremes we've gone to (i.e. my window screens have a sticker that says warning: death may occur if you fall through them.) Adding a whole lot more regulations now is not correcting the problem. Like I said, plenty of regulations were already in place.

I disagree. Many regulations were removed or modified to the point of being impotent. Ever heard of the Financial Services Modernization Act of 1999, otherwise known as the Gramm–Leach–Bliley Act? It repealed major provisions of Glass-Steagall Act of 1933. GLB allowed commercial banks to merge with investment banks and insurance companies, which allowed conglomerates like Citigroup to form, which would have been prohibited under Glass-Steagall. It allowed investment brokers to create and sell high-risk investment products to low-risk commercial banks. GLB is often high-lighted as one of the significant contributers of the subprime crisis.

What about the Commodity Futures Modernization Act of 2000... another bill that Phil Gramm was a co-author. That one kept the derivatives market, including the market for credit default swaps, free of any government regulation. One provision of that bill allowed the Enron scandal to occur.


The root of the financial crisis is the root of the same problems I see all over the place in corporate America and in the federal government - there's a crisis of integrity in this country - people who will not speak up or step up when they know something is wrong.

Here's a really good book I recommend for understanding not just the financial crisis but just about everything about our economy. It's written by two somewhat liberal leaning business journalists (which means I was shocked that I agreed with them) by the names of Bethany McLean and Joe Nocera entitled, "All The Devils Are Here." It's the best book in the entire financial section of the bookstores.

They posit that the blame for the financial crisis falls on everyone: Wall Street, Main Street, Pennsylvania Avenue, greedy traders (though I want my traders to be aggressive so I don't want that to change), misguided regulators, sleazy subprime companies, cowardly legislators, and last but not least, the home buyers who failed to act responsibly either.

One of the hearts of the problem was the reliance on the rating agencies (i.e. Moody) by Wall Street. In the past, when Moody said something was AAA rated, Wall Street never had a need to question it....but it turns out that's one of the significant contributors to the crisis because the ratings became unreliable (i.e. integrity issue!!).

Want to see an easy to understand tutorial on what caused the subprime mortgage and subsequent global financial crisis? Check this out:

Subprime Primer or How did I End Up Paying For My Neighbors Home (http://www.subprimeprimer.com/)

A "CMO" is a collateralized mortgage obligation. There is an explanation here, but beware... it's as dry as a popcorn fart:

Collateralized mortgage obligation - Wikipedia, the free encyclopedia (http://en.wikipedia.org/wiki/Collateralized_mortgage_obligation)


But back to GM, I think we need to let failing enterprises fail. I don't care how big. If we followed our anti-trust policies better, entities wouldn't be allowed to get "too big to fail" anyway. Therefore I don't think we should throw truck loads of money on these losers to begin with, so placing restrictions would be moot.

I disagreed with bailing out GM as well... at first. When the top execs showed up in Washington to plead their case before Congress, showing up via corporate jet, I wanted to vomit. Then I started to wonder what the ripple effect would be... all those employees, all the retirees who put their 35-40 years in, in good faith... all those parts and materials vendors, their employees, etc. The dealerships and their employees, etc. I just couldn't see allowing GM to fail completely.

I agree with the anti-trust issue. There used to be loads of oil companies around. Now, there's what... six majors, if that? We allow too many big companies to buy up smaller ones, killing competition. How's that for "free market" economy?

About GM investing in manufacturing in Mexico after being bailed out by American taxpayers?

How can that be? I'd go so far as to say most of the recipients of bailout money misused it in one way or another. AIG was a prime example. The US government gave the banks vast quantities of money with few, if any, restrictions on it's use.



I disagree. Many regulations were removed or modified to the point of being impotent. Ever heard of the Financial Services Modernization Act of 1999, otherwise known as the Gramm–Leach–Bliley Act? It repealed major provisions of Glass-Steagall Act of 1933. GLB allowed commercial banks to merge with investment banks and insurance companies, which allowed conglomerates like Citigroup to form, which would have been prohibited under Glass-Steagall. It allowed investment brokers to create and sell high-risk investment products to low-risk commercial banks. GLB is often high-lighted as one of the significant contributers of the subprime crisis.

What about the Commodity Futures Modernization Act of 2000... another bill that Phil Gramm was a co-author. That one kept the derivatives market, including the market for credit default swaps, free of any government regulation. One provision of that bill allowed the Enron scandal to occur.



Want to see an easy to understand tutorial on what caused the subprime mortgage and subsequent global financial crisis? Check this out:

Subprime Primer or How did I End Up Paying For My Neighbors Home (http://www.subprimeprimer.com/)

A "CMO" is a collateralized mortgage obligation. There is an explanation here, but beware... it's as dry as a popcorn fart:

Collateralized mortgage obligation - Wikipedia, the free encyclopedia (http://en.wikipedia.org/wiki/Collateralized_mortgage_obligation)



I disagreed with bailing out GM as well... at first. When the top execs showed up in Washington to plead their case before Congress, showing up via corporate jet, I wanted to vomit. Then I started to wonder what the ripple effect would be... all those employees, all the retirees who put their 35-40 years in, in good faith... all those parts and materials vendors, their employees, etc. The dealerships and their employees, etc. I just couldn't see allowing GM to fail completely.

I agree with the anti-trust issue. There used to be loads of oil companies around. Now, there's what... six majors, if that? We allow too many big companies to buy up smaller ones, killing competition. How's that for "free market" economy?

Impressive post, Sir. There's so much here...it's gonna take me awhile to respond in pieces...plus I wanna finish reading thru your stickman primer there first. Was going to do it today but too busy watching football, lol.

But for now let me start with the Glass-Steagall Act of 1933. That thing was like a boa constricter around the necks of banks. It was an emergency act thrown together by Roosevelt in his first three months to try to help stop the hemmoraging on Wall Street during the Depression. It wasn't even adopted to protect consumers - so not only did it severly restrict growth of financial activities in subsequent decades, it also didn't offer the protection liberals like to tout it for either.

As for the Gramm-Leach-Bliley Act of 1999, yes it did take down the firewalls between banks, securities firms, and insurance firms as far as business operations, but a glossed over point commonly left out by opponents is that it didn't mean regulation was thrown out the door. Regulation WAS maintained but the bank regulators regulated the bank part, securities regulators regulated the securities part, and insurance regulators still regulated the insurance part.

Glass-Steagall was so antiquated and cumbersome to banks that after it was repealed, we experienced a SHARP growth in the market in subsequent years. Beforehand, financial institutions couldn't exploit economies of of scale and diversification benefits like all our foreign competitors could. If we hadn't changed Glass-Steagall, London, Shainghai or Frankfurt would've been the global financial capitals, not New York. Beforehand, when the economy went though it's usual dips, financial institutions experienced losses and closures (which hurt them as well as customers), and allowing integrated operations of those financial instruments was a way to smooth out the roller coaster.

Did the pendulum swing too far the other way? Like usual in this country, it did, but a slight adjustment is needed - not a swing back to stifling over-regulation. Besides, it's also fairly well known in the industry that the Fed, the SEC, and the OCC (meaning those with oversight responsibility) all had plenty of tools to curb the abuses in the banking system but didn't have the will. Which brings me back to the point I made in my earlier post: regulation is not the problem. Failing to enforce regulation was. And that's the integrity issue I mentioned. Just as the corrupted Moody ratings were.

I'll come back and respond to your other points later, but we're both in total agreement that the overall culprit is the lack of enough anti-trust enforcement to ensure robust competition....and that has led to so many of these "too big to fail" monstracities . And here's where I lay blame on both conservatives and liberals. I'm not seeing the anti-trust rigor we once had and I'm not seeing passionate anti-trust advocates like we had in say the Reagan years.

Curt, the FCIC published the Financial Crisis Report today. Wall Street was of course reckless but one of the major findings is that regulations were there but regulators failed to use them. Regulators were "weak" - their words. I'm looking forward to reading this thing.

Curt, the FCIC published the Financial Crisis Report today. Wall Street was of course reckless but one of the major findings is that regulations were there but regulators failed to use them. Regulators were "weak" - their words. I'm looking forward to reading this thing.

It was a partisan report and I give it no credit for identifying anything more than what Democrats want to pass legislatively. Regulation may be an issue but that report isn't a good one to cite for objectivity.

It was a partisan report and I give it no credit for identifying anything more than what Democrats want to pass legislatively. Regulation may be an issue but that report isn't a good one to cite for objectivity.

I don't think you understand, Mikey. It's Democrats who like to say we need more regulations and are roaring to pile more on. This report is yet one more piece of evidence that it was not a "lack of regulations" that was the problem. it was the regulators' lack of willingness to use them.

You couldn't pay me to drive a obamamotors vehicle.

I own two Fords. One, we haven't had long enough to form a good opinion on. We've ad our Explorer sine Sept 08. Zero problems, but it's been less than two years.

My 03 F150 on the other hand, I've owned since 2004. It's been in the shop twice, and only once for something that I blame the truck for. The brake calipers went within a week of having my brakes done at, what I found out later to be, a shady garage. Myself and the Ford dealership believe it was the garage I took it to's fault, but no way to prove it. It was under warranty still so I didn't lose out on any money.

Other than that one time in the garage for something that broke on it's own, my passenger side door locks are going.

I'll buy another F-150 when this one dies.

About GM investing in manufacturing in Mexico after being bailed out by American taxpayers?

How can that be? I'd go so far as to say most of the recipients of bailout money misused it in one way or another. AIG was a prime example. The US government gave the banks vast quantities of money with few, if any, restrictions on it's use.



I disagree. Many regulations were removed or modified to the point of being impotent. Ever heard of the Financial Services Modernization Act of 1999, otherwise known as the Gramm–Leach–Bliley Act? It repealed major provisions of Glass-Steagall Act of 1933. GLB allowed commercial banks to merge with investment banks and insurance companies, which allowed conglomerates like Citigroup to form, which would have been prohibited under Glass-Steagall. It allowed investment brokers to create and sell high-risk investment products to low-risk commercial banks. GLB is often high-lighted as one of the significant contributers of the subprime crisis.

What about the Commodity Futures Modernization Act of 2000... another bill that Phil Gramm was a co-author. That one kept the derivatives market, including the market for credit default swaps, free of any government regulation. One provision of that bill allowed the Enron scandal to occur.



Want to see an easy to understand tutorial on what caused the subprime mortgage and subsequent global financial crisis? Check this out:

Subprime Primer or How did I End Up Paying For My Neighbors Home (http://www.subprimeprimer.com/)

A "CMO" is a collateralized mortgage obligation. There is an explanation here, but beware... it's as dry as a popcorn fart:

Collateralized mortgage obligation - Wikipedia, the free encyclopedia (http://en.wikipedia.org/wiki/Collateralized_mortgage_obligation)



I disagreed with bailing out GM as well... at first. When the top execs showed up in Washington to plead their case before Congress, showing up via corporate jet, I wanted to vomit. Then I started to wonder what the ripple effect would be... all those employees, all the retirees who put their 35-40 years in, in good faith... all those parts and materials vendors, their employees, etc. The dealerships and their employees, etc. I just couldn't see allowing GM to fail completely.

I gree with the anti-trust issue. There used to be loads of oil companies around. Now, there's what... six majors, if that? We allow too many big companies to buy up smaller ones, killing competition. How's that for "free market" economy?

Finally had a chance to get back to this post. When I said there's nothing free market about what happened with GM, it's because GM for all intents and purposes was "nationalized." That is not a free market concept; it is a socialist concept. And anything that happens after nationalization (at least partial nationalization) is built on a very different foundation, no matter how much it has characteristics of market economics.

Regarding bailing GM out because of the people who would be hurt otherwise - that's been the excuse given by politicians for decades for failing to do the tough thing, which is to stop subsidizing these garganutuum companies that have made the kind of bad business decisions that would've put any other company out of business a long time ago. There are also innumerable creative ways to have helped the people who would've been hurt by not bailing GM out. Innumerable. I myself have been a huge advocate of very robust retraining programs....retraining programs that are serious and not like the ones we currently have. For example, in my area the plummers and mechanics and electricians charge rates that are out of this world because we don't have enough of them. There's a huge demand. I think we should stop acting like everyone has to go to college and elevate VoTech skills to a higher level of priority. Then there is the huge demand for people with technical skills that foreignors are filling. We need better crafted programs and better incentives to match supply to demand in areas that are growing, not in areas that even the Chinese will be pushing off to poor countries soon.

And for your primer.......that is outstanding. Great way to explain a complex issue. Only thing is that all those little stickmen assumed the system at a higher level was working, i.e. AAA ratings meant AAA ratings, so I'm not as cynical as the little power point show is, but for the most part, it was on the money, lol.

As I've said before, I've been a GM man all of my life. My Grandad and Uncle sold Pontiac & GMC's @ their dealership in PA, where I worked as I was growing up.

Since the bailout, I've sworn them off.

I've never cared for Fords, as the truly nice ones have always seemed to ride like a truck to me.

Chrysler is Crap, IMHO.

We replaced my wifes Buick with a Honda. Built in Alabama.

When I replace my GMC, it will likely be with a Honda Pilot.