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Topic: Circuit City Closing 155 Stores

Joshua Waaland
Jedi Master Film Handler

Posts: 800
From: Cleveland, Ohio
Registered: Dec 1999

posted 11-11-2008 07:24 PM

quote: Bobby Henderson
If GM fails, the fallout from it could result in 2.5 million jobs lost during the first 12 months following the failure.

How many of those jobs are in Mexico? I bet they trump up those numbers to make it sound worse. I bet half of those are Mexicans.

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Bobby Henderson
"Ask me about Trajan."

Posts: 10973
From: Lawton, OK, USA
Registered: Apr 2001

posted 11-11-2008 08:57 PM

That's doubtful. GM does employ a lot of people in many different countries across the globe. And those jobs help sustain the livings of many other people.

Just from the selfish perspective, if Lawton's Goodyear plant were closed as a consequence of a possible GM failure (or a very likely occurrence if all three major US auto companies fail) then our local economy would fall right into the toilet and then I could probably lose my job. After all, I do work in an advertising oriented industry. When this kind of crap slimes somebody, it doesn't just splatter one very selected group of people. It splatters all over the freaking place.

The big three auto companies directly and indirectly employ a whole hell of a lot more people than freaking Wall Street does. But the way things are going, we're going to bail out some silver spoon types up there (who are largely responsible for all this horrible mess) and leave everybody else with a nice "F.U., Goodbye."

I'm not very confident that even a government bailout will save the U.S. auto manufacturers. I hope something is able to manage it. Because if it doesn't, the failure of GM and possibly Ford and Chrysler will be the thing to touch off "Great Depression II."

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Mark J. Marshall
Film God

Posts: 3188
From: New Castle, DE, USA
Registered: Aug 2002

posted 11-13-2008 02:59 PM

The Circuit City around the corner from my office has "Now Hiring" signs all over the lawn in front of the store.

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Joe Redifer
You need a beating today

Posts: 12859
From: Denver, Colorado
Registered: May 99

posted 11-13-2008 04:57 PM

The old DIVX format should be enough to demonstrate that Circuit City has had incompetent upper management with loose marbles since the beginning.

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Chris Slycord
Film God

Posts: 2986
From: 청주시, 경북도, South Korea
Registered: Mar 2007

posted 11-13-2008 10:28 PM

quote: Bobby Henderson
The big three auto companies directly and indirectly employ a whole hell of a lot more people than freaking Wall Street does. But the way things are going, we're going to bail out some silver spoon types up there (who are largely responsible for all this horrible mess) and leave everybody else with a nice "F.U., Goodbye."

There's the fact that the investment banks in the rest of the world might not lend anymore with our's or with each other in fear of what's happened here, making it not only a bad situation for us but the rest of the world too. Add to that, the big three's total debts are a fraction of Wall Street and the investment banks that prompted the whole ordeal.

Furthermore, while the big three have been having trouble, it's not remotely true that the car industry as a whole is dying. Lots of foreign companies now have plants here in the US and hire many Americans and are doing far better than the big three. Perhaps if the big three fail, those foreign companies can take over their plants?

Also, the big three pay their manufacturing workers, on average, 52% higher than Toyota, 52% more than the average of management and professional workers, and 132% higher than the average manufacturing wage.

I don't agree with the original bailout, but this proposed one seems even less necessary.

Also, if you're gonna complain that the people bailed out were the ones who created the mess, shouldn't you be arguing against a big three bailout? Surely, a large component of this problem is stupidity at the upper-levels of the companies.

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David Stambaugh
Film God

Posts: 4021
From: Eugene, Oregon
Registered: Jan 2002

posted 11-13-2008 10:54 PM

Why does GM still sell Buicks and Pontiacs? They have too many brands. They should immediately dump Buick and Pontiac. They got rid of Oldsmobile a couple years ago, so the concept of useless brandnames is not foreign to them. Keep Chevy for mainstream buyers, and Cadillac for upscale customers. Maybe keep Saturn as the "alternative". There is no rational explanation for GM having GMC, Chevrolet, Buick, Pontiac, Cadillac, Saturn, and Hummer brands. Look at their Japanese competitors: Honda & Acura; Toyota & Lexus; Nissan & Infiniti; Mazda & ______? Well ok Mazda doesn't fit this example. Anyway each major company has a brand for the masses and a brand for upscale buyers. They don't have some low-selling nameplate that only appeals to elderly fans of Tiger Woods. GM needs to clean house!

Well I guess they already shut down Hummer. Buick and Pontiac should be next if they're smart. Probably GMC too. Who the hell doesn't know that a Chevy pickup and a GMC pickup are exactly the same thing?

Actually it might be better to let GM go tits up. It'll be very painful in the short run, but the company will be resurrected in a couple years, with new lower-cost labor contracts, or maybe no unions at all, a streamlined product lineup, and they'll be in a much better position to compete than they are now.

Ford and Chrysler? Good luck!

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Bobby Henderson
"Ask me about Trajan."

Posts: 10973
From: Lawton, OK, USA
Registered: Apr 2001

posted 11-14-2008 12:47 AM

If GM had to file bankruptcy anytime within the next month or two, the current condition of the economy and frozen credit markets would make restructuring impossible. The company would be forced to liquidate. No second chances of re-emergence.

It gets even better. In a Bloomberg interview Wilbur Ross, an investor who made billions turning around distressed steel and textile companies, said a bankruptcy from one of the big three automakers right now could topple its two peers and drive already weakened suppliers out of business.

In order for GM to survive a chapter 11 filing, the government would have to step in to provide assistance and oversee the restructuring. There is no evidence the "private" financial industry would offer any help at all.

BTW, GM is already looking at eliminating a number of brands. They're trying to sell off the Hummer brand, if they can find any takers.

quote: Chris Slycord
Also, the big three pay their manufacturing workers, on average, 52% higher than Toyota, 52% more than the average of management and professional workers, and 132% higher than the average manufacturing wage.

This hints at one possible motive behind the larger resistance to a bailout of GM, Ford and/or Chrysler. Allowing the big three US automakers to go bust would be a tremendous blow against the UAW and unions in general.

Unfortunately, tossing many thousands of high paid blue-collar union workers out of their jobs would have serious consequences. Those good paying jobs also pay lots of taxes to fund schools, police departments and lots of other public works stuff. Lots of small businesses and all sorts of service oriented businesses get a big part of their income from those kinds of workers too. A lot of non-union people would lose their jobs. With so many people losing jobs at once it could overwhelm the pool of unemployment benefits.

quote: Chris Slycord
Also, if you're gonna complain that the people bailed out were the ones who created the mess, shouldn't you be arguing against a big three bailout? Surely, a large component of this problem is stupidity at the upper-levels of the companies.

A bailout, or at least some sort of assistance, to the big three auto makers would not be anywhere near as expensive as the lunacy going on with Wall Street.

Bloomberg News was denied a Freedom of Information Act request to the Treasury Dept. to see just what happened with $2 trillion of emergency loans to the financial industry. That's on top of the $700 billion Congress approved. There's no oversight. No transparancy. Wall Street firms are just hoarding the cash and spending it how ever they choose, which includes lavish executive bonuses and a lot more extravagant shit. A bunch of that money is crossing borders to Lord only knows where. The government might as well be pissing it away at a casino. That bailout hasn't worked and its cost is many times larger than what the auto companies are asking.

At least with an automotive company or other company that actually makes a tangible, finished product you have stuff you can track. There's actual factories, supply lines, etc. You don't have that sort of thing with some investment banking firm.

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James Westbrook
Phenomenal Film Handler

Posts: 1133
From: Lubbock, Texas, Usa
Registered: Mar 2006

posted 11-14-2008 02:41 AM

Toyota has 3 brands...Scion, Toyota and Lexus.

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Chris Slycord
Film God

Posts: 2986
From: 청주시, 경북도, South Korea
Registered: Mar 2007

posted 11-14-2008 05:09 AM

quote: Bobby Henderson
This hints at one possible motive behind the larger resistance to a bailout of GM, Ford and/or Chrysler. Allowing the big three US automakers to go bust would be a tremendous blow against the UAW and unions in general.

Well what makes the UAW so special that I should subsidize them negotiating a much-higher-than-market contract? Further, this isn't "allowing them to go bust" but is "allowing them to fix their own problems." Considering the situation, wouldn't you think it would make sense for the UAW and the big three to start renegotiating their contracts? Say the union is willing to take reductions in pay and benefits until the company gets solvent.

quote: Bobby Henderson
Bloomberg News was denied a Freedom of Information Act request to the Treasury Dept. to see just what happened with $2 trillion of emergency loans to the financial industry.

And I agree that it's ridiculous. But again, I don't buy the argument that because one area of the markets gets helped out that we should add a little bit more to another.

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Bobby Henderson
"Ask me about Trajan."

Posts: 10973
From: Lawton, OK, USA
Registered: Apr 2001

posted 11-14-2008 03:47 PM

quote: Chris Slycord
Well what makes the UAW so special that I should subsidize them negotiating a much-higher-than-market contract?

Because the failure of GM or all big three auto companies would adversely affect a LOT more people than just some lazy, overpaid union workers.

quote: Chris Slycord
Further, this isn't "allowing them to go bust" but is "allowing them to fix their own problems."

In this case "fixing their own problems" would be like a person solving an issue with depression by shooting himself in the head. Right now if GM goes bankrupt they go completely out of business. There won't be any opportunity for them to fix their problems.

quote: Chris Slycord
Considering the situation, wouldn't you think it would make sense for the UAW and the big three to start renegotiating their contracts?

They've already been doing that. But union pay isn't the primary reason why GM has lost over $70 billion since the end of 2004. Cutting union paychecks in half or further isn't enough to deal with the current problem either. Right now GM is bleeding out billions in losses because way too many customers are being denied financing. They can't sell enough vehicles to get remotely close to any sort of positive cash flow.

Those greedy investment banker clowns the government bailed out to nearly $3 trillion at this point aren't turning loose of any of that taxpayer money to unfreeze credit markets. Instead it looks like they're going to do a bit of business as usual: be secretive with how they handle the money, hand out lots and lots of huge bonuses and then maybe even help a few of those guys retire for life at ripe old age of 45.

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Chris Slycord
Film God

Posts: 2986
From: 청주시, 경북도, South Korea
Registered: Mar 2007

posted 11-14-2008 04:34 PM

quote: Bobby Henderson
In this case "fixing their own problems" would be like a person solving an issue with depression by shooting himself in the head. Right now if GM goes bankrupt they go completely out of business. There won't be any opportunity for them to fix their problems.

1) You clearly don't know a thing about depression. Depression isn't remotely like a company making bad decisions and asking to fix the results of the bad decision.

2) I'm confused how me saying "let them fix their own problem" was a sign of me accepting that they are going to go bankrupt. You're assuming they will file for bankruptcy and because they will they won't have any time to fix anything.

quote: Bobby Henderson
They've already been doing that. But union pay isn't the primary reason why GM has lost over $70 billion since the end of 2004. Cutting union paychecks in half or further isn't enough to deal with the current problem either. Right now GM is bleeding out billions in losses because way too many customers are being denied financing. They can't sell enough vehicles to get remotely close to any sort of positive cash flow.

I guess the financing issue is the reason why other car companies are failing left-and-right as well? Oh wait. They AREN'T.

I've known plenty of people who used to be big on the "Buy American" idea only to grow tired of the mediocre-to-poor cars they got and have since gone to foreign brands.

And again, just because the investment banks got money that I think they didn't deserve doesn't mean I think the car industry deserves money too.

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Bobby Henderson
"Ask me about Trajan."

Posts: 10973
From: Lawton, OK, USA
Registered: Apr 2001

posted 11-14-2008 06:59 PM

Chris you're talking like the Wall Street bailout and GM bailout are equal in size.

The idiots in our government approved another $40 billion today just for AIG -bringing that company's bailout alone to over $150 billion. To celebrate, AIG is going to hand out $500 million in "deferred compensation" to certain levels of management and senior executives. Yay.

I hate these bailouts too -especially the ones going to Wall Street. They're locking out any oversight from the goverment and avoiding any disclosure of how the funds are used to taxpayers. I guess in some sick sort of way that helps them say what they're doing isn't tantamount to socialism. As long as no one from the government is bossing us around with "an ownership stake" on how we use their money we're still practicing capitalism.

quote: Chris Slycord
You clearly don't know a thing about depression. Depression isn't remotely like a company making bad decisions and asking to fix the results of the bad decision.

It was an analogy -like someone curing their athlete's foot by amputating his leg.

quote: Chris Slycord
I'm confused how me saying "let them fix their own problem" was a sign of me accepting that they are going to go bankrupt. You're assuming they will file for bankruptcy and because they will they won't have any time to fix anything.

Without any help GM will run out of money for any operations by the end of December. They can't get any loans to continue operation. Financial companies haven't been willing to work with GM on this. GM stock is nearly devalued. The math is pretty easy on what will happen if everybody just sits back and watches.

quote: Chris Slycord
I guess the financing issue is the reason why other car companies are failing left-and-right as well? Oh wait. They AREN'T.

I'm currently working on dual billboard design for a Toyota dealership advertising lifetime warrantys on every new Toyota. No mileage limit. No time limit. Toyota may not be on the verge of bankruptcy, but the company would not be going to such an extreme on warranty coverage if it wasn't already hurting.

Japanese car companies have been getting beaten up pretty badly in this economy and the credit crunch is making it worse -not to mention a strengthening Yen that makes their exports even more expensive. They just didn't have so much of a reliance on SUV and pickup truck sales as the big 3 US firms. The Japanese companies have been well ahead of the American ones on hybrid cars. However, a car like a Toyota Prius is not exactly cheap. You'll spend over $30,000 on one with a decent configuration.

quote: Chris Slycord
I've known plenty of people who used to be big on the "Buy American" idea only to grow tired of the mediocre-to-poor cars they got and have since gone to foreign brands.

A bunch of that is stereotype anymore. I've had good luck with the two Chevrolet vehicles I've owned. American cars can have their problems. But Japanese cars are not totally immune from having problems either. Both Toyota and Honda make great cars. If I hadn't got the great deal I did for my pickup, I probably would have bought a Toyota Celica GT (that was my 2nd choice).

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David Stambaugh
Film God

Posts: 4021
From: Eugene, Oregon
Registered: Jan 2002

posted 11-14-2008 07:36 PM

A few weeks ago we were told that if we don't pass the $700B bailout RIGHT NOW, the world will end as we know it. A week later, the bailout was approved. (Oddly, the world didn't end during that week.) Now we learn they haven't spent all that money, and in fact they now want to use it for a different purpose than was originally planned (buying pieces of banks, rather than buying toxic debt). I suppose we should be glad someone realized the original plan was flawed before all the money was wasted.

Locally-owned Umpqua Bank was given $200M by the feds recently, even though the bank is not in any immediate danger of failing, not even close. A bank official commented "I guess we'll use the $200M to increase our footprint". Whatever that means.

Now it's GM. We are told that if we don't bail out GM by the end of the year, 3 million people will be out of work. Most of the domestic parts suppliers to the industry will fold, and when they do they'll put Ford and Chrysler out of business (I didn't see any mention of Toyota or other companies with a large US presence in the article). The failure(s) will have a ripple effect in Canada too.

Who are we supposed to believe? The only truth in any of this is the whole thing is way too complex for a few human minds to figure it all out. There's chaos theory at work here and nobody knows for sure what will happen. It's make an educated guess time.

quote: Bobby Henderson
I'm currently working on dual billboard design for a Toyota dealership advertising lifetime warrantys on every new Toyota. No mileage limit. No time limit. Toyota may not be on the verge of bankruptcy, but the company would not be going to such an extreme on warranty coverage if it wasn't already hurting.

Did some googling on that. I can find lots of individual Toyota dealers offering such a warranty, but nothing about it being backed by Toyota itself. A google news search on "toyota lifetime warranty" turns up nothing of relevance. [Confused]

GM on the other hand does have a 100,000 mile powertrain warranty.

Just to help keep this thread on-topic, Circuit City has still not announced any plans to close the store in Springfield. [Big Grin]

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Bobby Henderson
"Ask me about Trajan."

Posts: 10973
From: Lawton, OK, USA
Registered: Apr 2001

posted 11-14-2008 08:01 PM

I apologize about the thread drift. On the topic of Circuit City, I'm surprised they kept the Wichita Falls, TX store open. It especially seemed odd considering they closed the one in Norman that had only just opened a few months ago. Perhaps their lease costs for that really nice Norman location were really high.

I paid off the 0%/3 year financing deal on my 52" Sony TV and PS3 early (over 2 years early). Figured it would be better to have that liability paid in full before any monkey business happened to the terms on the deal.

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Chris Slycord
Film God

Posts: 2986
From: 청주시, 경북도, South Korea
Registered: Mar 2007

posted 11-14-2008 08:48 PM

quote:
A google news search on "toyota lifetime warranty" turns up nothing of relevance. [Confused] GM on the other hand does have a 100,000 mile powertrain warranty.

Some people argue that if you have to offer a long warranty it's because your product is expected to fail.

And yes, Toyota doesn't offer lifetime powertrain warranties though some individual dealers do. And a quick google search shows that Toyota offers 100,000 mi powertrain warranties (for both new and their "certified used" (guess they realized we don't care for the stupid term "pre-owned").

edit: And with individual dealers offering a lifetime warranty you might want to be careful now. It wouldn't be surprising (whether any company goes under or not) to see a lot of dealers go out of business. As such, if your dealer no longer exists, the warranty you paid for will be pretty useless (since no one honors it but a business that doesn't exist).

[ 11-14-2008, 09:56 PM: Message edited by: Chris Slycord ]

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