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’Renault gets a Russian bear hug
Russian prime minister Vladimir Putin appears to have forgotten his recent comments about reducing the state’s role in the economy.
As the The Wall Street Journal reported on Friday:
Russian Prime Minister Vladimir Putin said Friday that Renault SA’s stake in OAO AvtoVAZ could be diluted unless the French company helps bail out the failing Russian auto maker.
Yesterday it was banks, now it’s cash-for-’fill-in-the-blank’
If the term “cash for clunkers” festooning just about every news website, TV programme and newspaper is starting to drive you mad, think again.
Not since before the financial crisis has a chunk of US government spending been ushered through with so little opposition,
Just a little more off the top, Talf-man
So says, perhaps, the Federal Reserve with regards to the Talf programme’s haircuts.
Asset-Backed Alert reports:
The Federal Reserve is thinking about increasing the down payments it requires from investors that buy certain types of bonds with financing from its Term Asset-Backed Securities Loan Facility.
Lex: Porsche
The dismissal of Wendelin Wiedeking may clear the way for Ferdinand Piëch to leave his family an extraordinary legacy.
Porsche SE could inject the unlisted distributor into Porsche AG, which VW would then buy.
Chart du jour: April car sales
EconomPic Data provides some useful visual perspective on the awful US vehicles sales numbers released on Friday (click for full version):
Related links:
Uncertainty drives down Toyota sales – FT
BU57
New car registrations in Europe were down 18.3 per cent in February versus the previous year according to data from the European Automobile Manufacturers Association (ACEA). As the chart below shows the numbers have now been falling steadily since about April last year.
A counter-intuitive view of automaker despair
Can the auto sector get much gloomier?
General Motors is now warning that billions of dollars in government aid may not prevent it from running out of cash if vehicle sales do not improve soon. Meanwhile,
The mark-to-market Tarp
The Congressional Budget Office has done some number-crunching on the $700bn-Tarp. Turns out banks and car companies aren’t great investments.
Recall that the Treasury has so far spent $247bn of the Tarp’s $350bn first tranche (the second tranche of $350bn was made available for use on Friday).
Do the auto default wave
What does an auto industry default cascade look like? Like this, from Bank of America:
And that’s the reason why the US government may well be considering bailing out the country’s flailing auto industry using Tarp funds,
An auto(matic) credit event?
Here’s an interesting thought from Bank of America — would the appointment of a so-called automotive czar constitute a credit event for carmakers’ CDS contracts?
A caveat first, we’re not lawyers (clearly) and neither are BoA.
Male chauvinist stimulus
Linda R. Hirshman, author of “Get to Work: A Manifesto for Women of the World” (no sniggers in the back) thinks Obama’s stimulus plan is rather sexist.
From a New York Times op-ed:
BARACK OBAMA has announced a plan to stimulate the economy by creating 2.5 million jobs over the next two years.
Uh oh, automakers are not the Fed’s problem
Wall Street may have rallied on the back of the $15bn agreement struck in principle to save the automakers, but the details are, of course, still being finalised in Congress. Just in case policymakers are inclined to have any second thoughts,