Twinkies are back
Offline http://money.cnn.com/2013/03/12/news/companies/twinkies-buyer/
Four months after Hostess went out of business the brand has been purchased along with five of its bakeries for $410 million. Their bread lines (Wonder, Natures Pride, Merita, Home Pride and Butternut) sold to a different company for $360 million and the Drake brand has a bid pending for $27 million. Metropoulos & Co. project that Twinkies will be back on store shelves by summer so us poor Americans only have to suffer for 6 months give or take of living without Twinkies (my it sure is rough to be an American).
This illustrates exactly why we should not have bailed out the auto companies. When a company goes out of business, there are plenty of other companies out there that are willing to shell out cash to purchase the brands and equipment that are potentially profitable and during bankruptcy proceedings they can get them at a good discount and restart production relatively quickly. Twinkies will be back on the shelf and this time the company might be better managed and be profitable. That is exactly how capitalism is supposed to work, bad ideas fail and people with new ideas pick up the pieces and try something different.
We should have let the auto companies go bankrupt, instead we spent a bunch of tax payer money (that we had to take loans out for because we don't actually have the money) and are stuck with shares of stock that are not good investments in a company that is likely to have to declare bankruptcy again in the next few years. Are we going to bail out GM again?
Let the losers go out of business and stop paying executives who have demonstrated they are incompetent and give someone a chance to sink their own money into the remnants and try to make it profitable. There is no reason to risk taxpayer money by getting the government involved in such affairs. If I want my money to be invested in an attempt to turn around a bankrupt business I will go buy into it directly.
If, if a white man puts his arm around me voluntarily, that's brotherhood. But if you - if you hold a gun on him and make him embrace me and pretend to be friendly or brotherly toward me, then that's not brotherhood, that's hypocrisy.- Malcolm X
- Login to post comments
I agree. The bailout is bullshit and an example of people in power who used their political influence to get money and no interest from the federal government to save their positions of power.
Yea we shouldn't have bailed out the auto companies. Right, but since your voting habits, third party or not, still contribute to "too big to fail" we had to. But humn, what has happened since? Not only did we bail them out, they ended up making a profit for us. For someone who loves profits you certainly bitch alot.
See I hate your mentality because you cant understand none of this shit would have gotten to this point if anti monopoly laws and regulations had been enforced. You clamor over "less government" failing to understand for that to work "in theory" it requires business to behave on it's own. If the banks and car companies HAD BEEN doing that in the first place we wouldn't be in this mess.
You are not going to have it both ways. IF IF IF IF IF a business wants government off it's back, then it cannot do the destructive things that put us in this mess. But to argue when it does fuck up government should not step in is absurd. Why have a government at all if all we are going to do is allow business to do whatever it wants and never hold it to account?
I am so sick of your poor me pity party. You scapegoat the workers and blame everything on them when they are not the ones who wrecked the car then you blame us for saving their asses. Just like the god character, blame the weak when you are the one with the power not to set it up in the first place.
"We are a nation of Christians and Muslims, Jews and Hindus -- and nonbelievers."Obama
Check out my poetry here on Rational Responders Like my poetry thread on Facebook under Brian James Rational Poet, @Brianrrs37 on Twitter and my blog at www.brianjamesrationalpoet.blog
Why did we have to? The point of my post is that if GM and Chrysler went under they would have been bought out by private money and would have shut down temporarily just like Hostess only to be started again under new ownership. And no, we did not profit from the auto bailouts. We took a 50% loss. The only reason we profited at all from the combined bailouts is the decent profit made from AIG ($22.7 billion) which led to a gross profit of $2.4 billion.
So on its face the government has $2.4 billion more today than if it had done nothing right? Well no, in the combined bailouts we spent $243.5 billion and it took 3 years to recoup that is a slightly less than 1% return over 3 years. You get a better interest rate in a basic savings account. Add in the fact that we didn't have $243.5 billion in cash on hand and had to take out loans for it. On average we pay 3.29% interest on our government debt. That means in interest alone we paid over $12.5 billion just to get the cash.
That doesn't take into account all the government bureaucrats who got involved in making the deal happen, observing it and all the miscellaneous expenses certainly added up to several millions. At the end of the day, we have less money now than if we never did the bailouts at all.
http://articles.washingtonpost.com/2012-12-20/opinions/36018549_1_auto-bailout-government-motors-gm-and-chrysler
Although as a side note I do want to point out that my issue with the bailouts is not that we took a loss. Even if we made a huge profit I find the whole thing objectionable. I do not believe the government should be involved in deciding which companies succeed and which fail, that road inevitably leads to massive amounts of corruption. People should be free to choose if they want to invest in a company and take the risks and rewards themselves. The government has no role doing so for us.
The market was doing it. The big companies were going out of business because they were failures which would have caused three or four smaller companies to purchase their remnants creating a larger number of viable competitors in the auto industry. Instead, the monstrosity that is GM still has a significant hold on a large share of the market and effectively blocks out smaller companies despite the fact that its future profitability remains dubious at best. Allowing GM to go under would have destroyed the company closest to having a monopoly in the US auto market and allowed fresh competition. As someone who so loosely uses the term monopoly and considers monopolies the greatest evil of all, why don't you support allowing a monopoly to collapse?
GM doesn't want government off its back. Government handed them a shitload of money for nothing. Why should they change their behavior when they can just go to the bank of Uncle Sam and get another $50 billion? They were not held to account, they were rewarded for their failure. Left to their own devices the company would have been held to account by being wiped out of existence and all the current investors would have lost their money.
What do the workers have to do with it?
If, if a white man puts his arm around me voluntarily, that's brotherhood. But if you - if you hold a gun on him and make him embrace me and pretend to be friendly or brotherly toward me, then that's not brotherhood, that's hypocrisy.- Malcolm X