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Subject:  Re: Ford's white-collar workers to get buyout of Date:  12/11/2006  1:44 AM
Author:  mishedlo Number:  5722 of 7023

Thanks for the chance to clarify

Here is the text:
Instead, the company tries to cut expenses to put off the inevitable as long as possible.
-Exectutives get to keep their high paying jobs a little while longer.
-The stock market stays propped up a little while longer.
-Wall St. doesn't have to pay out on Billions of dollars worth of credit default swaps for a little while longer.
-The money supply avoids a big credit contraction a little while longer.

Two main options on Ford's eventual bankruptcy:

A: Get it over with and preserve the economy and jobs.
B: Put it off and pad your pockets while your community slowly dies.

Ford management is choosing option B.

I agree with all of that (with one exception below), especially the part about preserving the company just to pad their pockets. I have made similar statements before myself somewhere. I even admit it is a problem because the company is supposed to act in the interests of stockholders not bondholders. But I do not think that is why they are doing it.

Ford just pledged 40% of the company to get financing.

What I disagree with is whether or not it would have actually saved jobs. The market does not like Ford cars and as long as it stays that way will go out of business even if they can produce cars on a price competitive basis.

So it is in effect not a 100% agreement.
It is necessary to reduce
A: Get it over with and preserve the economy and jobs.
A: A: Get it over with

BTW - I noticed that just as soon as I posted it so you will have to ask Rodger why Ford jobs would survive

The advantage of A is that there was enough cash so that all workers would get their promised pensions and promised healthcare benefits. Whether it would have saved jobs long term is indeed debatable. I think not actually so thanks for giving me a chance to correct.

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