Did Bob Corker Just Cause GM to Lose 10% of Its Value on Inaccurate Information?
Bob Corker is very busy trying to force the Big Two and a Half into bankruptcy so he can bust the UAW. He’s using all the regular methods–arguing about GM’s failed business model, arguing that they haven’t changed their business plan.
But he went over the line, earlier, when he stated that the Department of Energy had rejected all the Big Two and a Half’s applications for DOE funds to retool their factories to produce more efficient cars. Basically, he took the opportunity of the hearing to announce, publicly, that the companies weren’t going to get $3 to $7 billion they were counting on to turn around their business. He even suggested that the applications were rejected because they weren’t viable companies.
Only, he was wrong.
Funny thing is, though, the stock market didn’t wait until Sherrod Brown came in and corrected Corker–by noting that the DOE had not rejected the applications, but had simply asked for more information. And it didn’t wait until Corker himself–having been called by the guy awarding those loans–admitted that he was wrong. (Though, dead-ender that he is, Corker still tried to insinuate that they applications were rejected, rather than sent back for more clarification.)
Not long after Corker made those remarks, GM’s stock price dropped from $4.44 to $4.27. And then it dropped again, from $4.27 to $4.02. $.42 altogether, all shortly after Corker insinuated false things about government decisions in a widely and closely watched hearing.
I know that $.42 might not be much to you, Bob Corker. I know you’re working hard to bankrupt these companies.
But it really is rather bad form to take out 10% of a company’s stock price just so you can make an ideological point.
I think he should be fined for SEC violations on a number of levels.
No kidding.
Brief explanation, please…?
I think that I follow you, but would like a primer paragraph or two to better explicate this post.
Thx…
Here’s what I heard and saw yesterday from Corker… I saw participation in false rumors attempting to push the price of the stock down, or stock manipulation, which Cerberus would probably be interested in (or one of their investment portfolio participants might be interested in.
He revealed non-public information intentionally and appears to have aided in a breach of relationship trust/confidence where non-public information was used from Cerberus citing a board.
I would be interested to find out who bought their stock (2.5 auto man. and Chrysler)) when it tanked yesterday.
Stock manipulation, insider trading (maybe) for example.
By tanking Chrysler on camera, their stock dropped enough to perhaps make the merger more of a possibility. He was coached on exactly what to say. Evident by the fact that when he got a second chance to talk, after the record was corrected on a few points, he repeated the false rumors and misinformation. If the info he was sharing WAS readied for public knowledge he could have stated WHICH board member he talked to in a quite public fashion. But then he would have revealed his participation in a conflict of interest perhaps.
And, ROTL, if you want a bigger picture of the mindset Corker was aiding, try reading this.
I would not be surprised if a merger is announced sometime today before the market closes.
At the end of the hearing, Dodd made some noise about how the committee always works in a bipartisan manner and specifically thanked Corker. Was this a caution disguised as a compliment?
In the famous Republican ease of date, “You betcha!”
I guess Corker really doesn’t like “earmarks” coming into Tennesee.
gm is just following the overall market…
OT but connected to one of our favorite former USA’s: Special counsel faults Paulose
Is Corker’s board contact Dan Quayle?
dollars to donuts, these guys are going to fuck this up.
Don’t go out on a limb there big fella.
Yeah. There’s a limit to how many donuts even I can eat…
talklowbuylowsellhigh
From the CarConnection
We have at least three to pick from…
Just imagine if the media actually reported these kinds of connections?
Cerberus= Quayle, Snow, Rumsfeld — for starters! And they own around 80% of Chrystler? There’s a lot more money in financing autos than in building them, and ‘the financial sector’ at GMAC is almost certainly not unionized.
Clearly, it’s time to blame the US public – the biggest culprits being: those without medical insurance, or belong to a union (particularly the UAW).
Corker’s extensive kool-aid drinking seems to be good for the finance guys. Too bad about the unions…
Why is it that the Goopers are wired to Counter-Attack Innocent By-standers on the basis of No Good Reason, other than They Believe They Are Right?
Attacked from Afghanistan, Invade Iraq?
Mugged by Wall Street, Knife the Auto Industry?
Credit Squeeze, Shrink Payrolls?
It makes no sense – these Mad-Moments render the Goopers Too Erratic to deal with Our Very Real Problems.
Rabble Rousers like Corker – lashed into Granny’s Rocker on top of Jethro’s Jalopy – should be shouted-down so that the Good Sense of Preserving American Jobs can be appreciated and hopefully Prevail as We coast into this Depression.
So, here’s the crawl for the Goopers: “Job Preservation Good…Job Loss Bad…”
An OT special for Emptywheel.
The Republicans have been very focused on bringing down the unions. They will use any excuse to do so. For example, in this recent round, they blame the unions for the cost of medical insurance and pensions. As if the management of the automakers didn’t acquiesce and enable the unions. And isn’t it the job of the unions to get the best, the most, for their membership? Are the workers supposed to get only what management wants? At any rate, being surprised by all the attempts to break the unions is kinda naieve. This has been going on a long time. The important thing is to separate out the facts from the BS and propaganda. A friend of mine, staunchly Republican, blames all of the problems the auto industry is facing on the unions and the health plan and pensions; when, actually, the German automakers, who have equally good plans for their workers, perhaps even better, seem to make a profit, perhaps because their government finances these plans. At any rate, why is anybody surprised at this Republican tactic? It seems to me this kind of naievete was rampant when the Democrats were the minority and people were wringing their hands at those awful Republicans doing such terrible things.
the cost of medical insurance is connected to a ’sue their ass off’ mentality in the usa, which unfortunately seems to want to make a foot hold here in canada as well.. then their is the pharma industry and the drag that is on the system… why is it always that right wing folks want to screw the unions, while supporting corporations that are primary interest is in profits without consideration for so many other factors their primary interest destroys? i guess i could say the same of the lawyers. it all boils down to money it seems… got to keep that corporate funding flowing..
There is nothing but bellicose rhetoric behind that assertion and, to the extent that it is true, it is the litigation defense arms of the medical providers and affiliated interests that settle nothing, litigate everything, use scorched earth tactics to scare off plaintiffs and try to run them into the ground etc. that are the main culprits. Lawsuits are NOT the problem with medical costs in the US.
bmaz, if you don’t think a litigious society helps push the cost of everything up including medical coverage, what do you think contributes to it?
Over lunch today with my son, I finally decided what I think the government should do with the automakers. Ford is obviously in the best shape and (assuming GM doesn’t go belly up) just needs some bridging financing which the gov’t can provide in return for Ford agreeing to do the right thing in a few obvious areas. Chrysler needs a buyer, but let’s deal with GM first. The Republicans aren’t going to be part of any reasonable deal, so Obama and the Dems need to go it alone and go big: Let it be known that HR 1 is going to be a bill giving Obama the authority to nationalize GM if it goes into Chapter 7. Turn Plouffe loose with those bazillion email addresses to drum up public support for the measure. People trust Obama and this could be sold as ‘In case of emergency, break glass’ measure. Let see how fast some these moderate Republicans come around to the idea of doing something now.
Not a bad idea, imo. But I fear the GOP might be strongly tempted to let Obama float the plan, and then just scream bloody murder that “see?-we told you–he’s a socialist!!” Would be quite a base-motivator for them.
GOPers might easily be willing to vote against it, lose, spend the paltry billions in order to have that weapon to use against Obama.
I’d add that nationalization might actually be the best fix for the problem, but if Obama were actually crazy enough to try it, they’d have to find a new word for “nationalize”. Call it “Let’s Roll”, or some such.
‘Socialism’ has lost its shibboleth power these days. Eventually the wingnuts are going to figure out that Sarah Palin really did look crazy to a lot of persuadable voters. Nothing ruins a good smear faster than overuse by people who look crazy.
As a hardened socialist, I find the current situation quite pleasing. Maybe I can figure out how to goad those idiots into calling Obama a pacifist next.
Citizen WilliamOckham:
“As a hardened socialist, I find the current situation quit pleasing.”
There’s another one of us out here, Brother William…we have only to wait and watch, the contradictions have the bastards eatin’ each others’ children.
And another here.
Hide and watch. When the smoke and dust settles we take on those left standing.
Maybe. I’m not so sure.
By the way, some exerpts from a Michael Moore letter yesterday:
I guess that mean old Michael Moore must be a “union buster”. For anyone who is against this deal surely must be.
I love that. Let’s put that campaign capital to work.
Gee. I wonder if any of Mr. Corker’s aides or friends or donors just happened to buy GM stock late this afternoon.
As far as I know — and I’m open to correction — the push to ban day-trading based on info gathered inside the halls of Congress didn’t survive.
OT but it is another “Oh Dana” story from ThinkProgress. Oh-Dana Perino has proven the Downing Street Memo was not true. Oh-Dana does not say how she disproved the British memo which had said Saddam did not have Weapons of Mass Destruction. I am guessing Oh-Dana used faith based public relation do-overs. Of course the Bushies have just promised more WMD attacks on civilians, excluding international bankers. Helen Thomas I love you!
Q: What about the chief of British intelligence saying you were going to fix the facts around the politics?
PERINO: I think that that’s been debunked.
Thomas quickly countered, “It’s never been been debunked.” Caught off guard, Perino admitted that she was the one who “debunked” it:
Q: It’s never been debunked.
PERINO: Well, it’s been debunked by me.
Q: Good for you.
PERINO: Good for me.
Ran out of things to throw at the TeeVee and the dog thought I had gone over the deep end…… Corker should be investigated on what he gained for telling lies
Then Bush said about the Auto industry …… no reason to throw good money after bad….. WHAT have they been doing in the financial industry?
1,46 DAYZ AND THE KILLIN GOEZ ON AND ON AND…
Firepup Freedom Fighters:
When the EFCA passes and Walmart and the foriegn auto plants in the south are unionized, folks like Corker are gunna go the way of the Dodo bird and what’s left of the rump fascist party will go with ‘em.
KEEP THE FAITH AND PASS THE AMMUNITION, THIS ONE IS GUNNA BE WORTH FIGHTIN’!!
Senator Bob Corker (R-TN). I could carve a better man from a banana.
Corker is a good example of why working with Republicans is a non-starter. Either they are so batshit crazy that no deal is possible, or if a deal is done it will be so bad that nothing constructive will result from it.
It is important to remember that Republicans in Congress and the Administration had no problem trashing the Constitution and most Democrats were content to watch them do it. Corker is a good indication that they are willing to do the same to the economy. The question is will the Democrats fail to act effectively again.
The amazing thing is that he wasn’t even the craziest republican in the r primary.
I was sticking pins furiously into my Corker voodoo doll whilst he was speaking. I couldn’t believe he announced that. What a capitalist tool.
Well, at least he’s transparent so you can argue against him. I’d hate it if it were a hidden agenda that they’d all agreed on.
And as I noted at the time, Corkhead wants the auto industry to be profitable at the BOTTOM of the cycle. I’ve analsysed just about every cyclical U.S. industry in just about every cycle and I can’t think of a single example of when they’re profitable at the bottom. He’s now set that up as the standard and I’ll bet all the Rs join in to demand the impossible.
You got your Oxdown diary to that effect written up yet?
;-p
Heh, …are you daring Miz eCAHN? Scrum…!
Oh, we can’t forget to include Corkhead as the latest proponent of the Shock Doctrine.
No Gloomy Gus here…!
Where was his ‘Situational Awareness’ and frankness while he was at the helm…???
*sigh* How could I’ve left out the coup de grace…
-picks up jaw from desk-
Corker and probably most Republicons are willing to see a Depression with the collapse of the auto companies if it means that they can destroy the unions. What Corker doesn’t realize is that a Depression will radicalize Americans and the only ones finally destroyed will be the Republicons.
The f**cking idiots on wall street make a perception reality. How stupid is that. Somebody on an oilfield walkboard in Nigeria trips and the price of oil goes up $10 a barrel. Now we have a jerk spouting nonsense in DC and the value of GM goes down 10%. ENOUGH
b
Are you sure about that?
Just about everyone here is correct in their assessment of what is going on. The problem is we are preaching to the choir for the most part and need very much to take these ideas to the public, more specifically the non-internet public.
What if we took the same resources we used to get Obama elected, and turn those into getting the funds necessary to become a majority stock holder in a MSM source, such as MSMBC (I pick on that one since it is already leaning more in our direction than any of the others). Then we can start teaching the public what the “real deal” really is. I would be willing to throw in $20 (funds are really tight).
Food for thought. AB
It’s not necessarily MSNBC.com’s politics that I find so key; it’s their technology.
I don’t recall how or why it happened, but NBC ended up with a cable system — as did CNN, whereas neither ABC nor CBS own a cable system IIRC.
But it would be extremely important to ONLY put accurate info anywhere else.
I do my ponderous best to ‘think aloud’ around here, but it’s always a worry having to be able to cite and source info that is actually published, broadcast, or disseminated.
IMHO, FauxNews greatest problem is that they don’t source their info well, which made them very vulnerable to spewing blatant ideology (the rest of the media succumbed to other problems, largely related IMHO to acting as scribes for government and biz sources rather than doing enough investigations on their own).
I don’t run the place, but as a frequenter at EWs bar, I’d say it’s an interesting idea.
But IMHO, one of the most valuable aspects of EW is the focusing on accuracy and trying to ferret out the truth and expose nonsense (and worse). Truth is kind of like a gigantic magnet; it draws things to itself. At least, that’s the way I see it. (Perhaps Karl Rove would argue that the truth repels, but then I don’t put my stock in anything he says.)
I’m from Michigan, have relatives retired from GM and I fail the understand the logic of a Corker. These relatives are some of the best workers and great mechanics, some of the most talented people I’ve ever met. They can do nearly anything mechanical. If a Michigan worker go’s to another state, they can almost be assured of a job because of the work ethic and knowhow.
I called Senator Stabenows and Bart Stupaks office today and asked if DC was wasn’t really a different land or in an alternative reality. I Just couldn’t believe the stupid statements coming from those committee members especially the southern republicans.
I am just beside myself about the ignorance in this country. It looks like all the comments are right, it’s all about unions.
I could not believe how Corker got to stand on his soapbox and drone on and on in the most obstreperous manner. If he doesn’t want to loan the auto boys any money, does he have any better ideas to make sure Americans are employed and Americans can buy stuff?
Hey Randiego, looks like the Bolts finally found an opponent they can play with!
heh, game ain’t over yet. It’s depressing.
That grizzly bear they just showed is the missus’ footage.
I have only saw part of the 1st hearing and haven’t read the posts yet, except the one above. But here is what I got out of the hearing.
Corker seems to be playing the bad guy and Wagoner the good guy. (good cops/bad cops) Corker wants to (help Wagoner?) bust the unions and force the US auto companies to have the same lower scale wages as the foreign auto companies. I am sick of the word “transplant” they are FOREIGN auto companies, they are not American Co’s that moved from one state to another. Now do you think that would happen in any other countries where a foreign co’s wages would dictate a nation’s co’s wages? Why is no Senator saying lets look at our trade laws maybe we have allowed to many foreign cars to be built here? Couldn’t the auto co’s be helped that way? Isn’t there a law on the books that protects that? Have our past legislatures been that lazy or stupid? It is going to drasticly lower the US standard of living in the coming decades already by the concessions the union has given up. How many foreign co’s can come here and take over our industries and we just say ok we’ll hand over our good paying jobs to you?
Maybe Corker’s trying to make blue states wages as low as the red states? I can’t believe Corker wants to give what the auto companies would get in bankruptcy court without going through bankruptcy. Unreal, just uneal. I can’t believe I heard a US Senator say what he just said abt the wages being the same as the foreign co’s. Where is his patroitism and pride of a 100 year old American co? Does he hate American’s that vote Democratic that bad?
I will say that again, how can any US Senator want to give our good paying jobs away, lower our standard of living, lower the tax collected and the states standard of living that the auto co are in? Maybe he is wanting to punish blue states?
Corker is the only one seeing the big picture…he has a business background and is pinning the little 3 down on realistic numbers. GM is profitable in other countries but has to send that money back here to the black hole. It isn’t Corker’s decisions which are affecting GM’s retiree’s, it’s bad decisions made by GM and gov’t/state laws allowing foreign companies to come in and operate at an advantage.
If GM/Chrysler are not viable, which Corker is trying to get to the bottom of, then the rest is useless and these retiree’s are screwed anyway. Corker has done the best job in both hearings cutting through the lunacy of prospects that GM/Chrysler can slash their way to success.
In the end they have to sell more cars….which means they have to have products that are so tasty that the competition is beaten, not going to happen. It’s too late to regain what they have lost…it’s time to let them fail if the business model is hopeless.
The longer GM operates in a country the more market share they lose…since that is a trend in every country they operate in what makes you guys think a bridge loan will save them. Furthermore it’s evident that the 34billion, up from 25billion is just the beginning.
I don’t know how Obama’s Admin. will handle this but I bet you he can’t bet you he can’t make these companies viably standalone.
You guys can’t see the forest for the trees….bipartisan much?
Bob Corker a business genius??? You have got to be freaking kidding me. He was a common land speculator who used his political contacts to rake inordinately during the real estate boom of the early to mid 2000s. A monkey could have made money under those circumstances, and many did. Your premise is a joke to start with. Secondly, the GM business model is not “hopeless”, if you had studied the facts, or even read the material here over the last few weeks, you would realize that.
Oh, yeah, but these vain monkeys all think they’re geniuses.
I’ve met some very classy, extremely smart developers of high end properties in upscale regions and they have guts, savvy, and initiative. They’re smart and interesting, and they build cool things.
Then go lower down the food chain to the Corkers, who think that ‘money makes money,’ and preen their way from one golf course to another**. They’ve never invented or created anything other than an LLC (Limited Liability Corporation), and end up often screwing their subcontractors. In my experience, this caste has a lot more ego than judgment.
Corker is a walkin’, talkin’ example of the dreadful problems of what Robert Reich terms supercapitalism.
** No insult intended at golf, which is a great sport.
Yeah? Then how come it isn’t/hasn’t worked in decades?
If a monkey can make money then how much money did you make in the easy money years?
Sorry, the legacy debt GM has is too much to overcome.
Enough, but I am sure that I could have done much better if I had been in Tennessee in a county with a bunch of inbred backslapping political cronies and a bunch of personal political muscle to exert influence like Corker had.
How did you do?
I think Chyrsler was set-up yesterday. Notice how often their report was cited as lacking content. It appeared as though Congress critters communicated a bit more to Ford and GM behind the scenes, leaving Chrysler to hang. The fact that the GM-Chrysler merger failed only months ago, makes the public manipulation more believable. I think the hearing was intended to tank Chrysler for opening gov’t financing of GM’s merger when Cerberus could do it on their own. Especially now, after Corker’s prized performance.
I’m not down with the stock manipulation theory but I am down with the reality that there is not room in the market for three American car makers.
Chrysler does need to go, it isn’t a standalone car company in the first place or Cerberus wouldn’t be in the picture. Given that GM is still a standalone…between the the two if one should be given the green light for bridge loans it should be GM.
I concur with bmaz. You don’t know your ass from a hole in the ground.
There’s plenty of room for 3 U.S. automakers IF THEY HAD THE SAME PLAYING FIELD AS THE FOREIGN AUTOMAKERS.
– incentives
– younger workers on average
– newer equipment/facilities on average
– national health care in their countries of origin
For starters. You ensure the playing field is level, take care of the credit crunch that the financial industry and the Bush administration caused, and there’s plenty of room.
You also don’t realize that if the Big TwoPointFive tank, that there isn’t enough room for multiple foreign automakers — they rely intensively on the development that their competitors do in auto parts and capital equipment to be competitive. They cannot produce a car profitably without the Big TwoPointFive absorbing so much of that development cost here in the states.
bmaz has a point about your assumptions about networking skills or connections. You really have NO idea who’s here as hosts or regularly in this blog as commenters, newbie.
You don’t know your ass from your mouth…if you want to go down that road.
Wagoner told Congress today that all the good battery technology was in Japan and Korea…so how is ‘relying intensively on the Big TwoPointFive’ and their development blah blah blah fit in to your assertion? It doesn’t…so you don’t know what you’re talking about. Foreign companies can and have been progressing on their own not to mention staying ahead of the game.
They are trying to get to a ‘level playing field’ but it is unlikely to happen unless the bridge loan grows to about 150billion. Then the majority of buyers have to magically want the big 2.5 products more than other offerings. Who has faith in that?
Too bad your networking skills and connections suck then.
I did alright too, and better since.
I am thrilled for you.
But you don’t know your ass from a hole in the ground about me, my networking skills or my connections. So, your condescending little throwaway line doesn’t establish much except your own arrogance. Furthermore, what exactly does your or my relative financial status have to do with the point at hand? Nothing. And what exact weight does it bring to bear on the fact that Bob Corker is far, far from being any kind of business genius? Again, nothing.
I never said Corker is a ‘business genius’ so who’s making assumptions now?
My point is it’s clear the majority of posters here bash him because of an ideology which has nothing to do with the case he’s making. Yes, he’s a politician but the car makers dire circumstance is not political except that that they get called to the Hill so politicians can grandstand for their respective constituents…at least he knows how businesses operate.
So his questioning and concern for the future viability has everything to do with his business sense. That’s plenty of weight.
Don’t know you, but here’s some kindly advice from a long-time EW reader and commenter –again, I sure don’t own the place, but here’s what I’ve observed over a period of over two years, mostly daily:
1. Rayne is brilliant. This woman is absolutely brilliant. She’s done corporate research of some type, and she has been environments that don’t have time or patience to tolerate candyass bullshit. Any commenter dumb enough to insult Rayne is someone’s name I’ll skip next time out.
2. bmaz’s analyses are often dazzling, and there are students paying tens of thousands of dollars to law schools getting less education than the witty, erudite bmaz dishes out here each week. Again, anyone who comments insultingly to bmaz is a name that I’ll skip over next time.
The people who post and comment here are, IMHO after reading for several years, extremely bright.
If you could manage to extract your head from your anal cavity long enough to read a few of EW’s previous posts, I think that:
1. You’d learn a ton,
2. You’d find her to be a fearless — and brilliant — instructor,
3. You’d find that people who comment around here ‘call bullshit’ in one hell of a hurry when someone interferes with the common task of seeking to understand complicated, extremely fast-moving or confusing policies and developments.
4. You’d discover that there a number of bilingual commenters and readers who can access remarkably timely, relevant sources of information.
If you were smart, you’ d leave an apology and be grateful to have the chance to encounter such fine minds. Ball now in your court.
The way that I read this thread, and heard Corker’s comments, his mental framework for ‘corporation’ is outdated (probably to around 1985), and he revealed that he was not a very perceptive listener, nor did his questions take advantage of the chance to really dig into the fundamental issues involved in this bailout, and the Wall Street bailout. He did not show the analytical skills necessary to really examine and comprehend the nexis of problems related to this bailout.
Acquainting yourself with EW’s previous work on this topic would help you understand why some here view Corker as in waaaaaayyyyyyyyyyy over his head.
Brush yourself off, pick yourself up, and be polite next time.
Franky it sounds like you need to extract your head from bmaz’ and Rayne’s anal cavities because they do not corner the market on knowledge and/or pertinent opinions on any subject.
And you’d be smart to realize that and think more independently….you don’t really need them to guide you through life, or do you?
Now get up and dust yourself off and get back to the topic or mind your own business because you are obviously waaaaaaaaayy over your head here.
Alright. That will be quite enough. You got cute with me making comments about characteristics about which you have no knowledge whatsoever and that were impertinent to the subject at hand. I should not have wasted my time or effort in responding to that head on; little useful ever comes of that, and nothing useful did here.
I do not know you, have never seen you here before and have no desire to be at loggerheads with you; but, the current antagonism is going to cease. This has been an inauspicious start for your time here; how about we all reset to a neutral baseline and start again and try to do it right? That is my suggestion, and it is made in good faith, but what has started here is going to stop here and now one way or another. I know that Rayne, rOTL and I will honor such a bargain, the rest is up to you.
Och. So I’ve been flagged for being offsides…
Okey, dokey then. Onward to civility
Nice job stealing a chart from google finance with no citation, classy.
The link to Google is in the body of the post exactly where it references the chart dimwit.
Classy right back at ya.
That’s not a link to the chart used, just GM’s page on google finance, 2 different things.
Well, I saw the chart at the time the capture was made for the graphic, and that is indeed where it came from. Man is this an inane issue.
Hmmm…lots of blog comments out there attached to posts on the auto bailout with the same mantra, with ties to finance, congresscritters, and perhaps Russia…and all the same commentor…
no answer can be taken as answer in itself…
heh, another one who can’t mind their own business. Some of us have lives outside of EW.
I tell you what…I’ll leave all of you to your self-absorbed, undeversified little make believe kingdom here in hopes that someday you too will get a life.