General Motors In Crisis Talks To Cut 35,000 Jobs

WoW sure has been alot of job cuts lately

General Motors In Crisis Talks To Cut 35,000 Jobs

Richard Wray in New York
Tuesday March 21, 2006
The Guardian

General Motors is trying to stave off the possibility of collapse by thrashing out a last-minute job reduction plan with its former subsidiary and now major parts supplier, Delphi, and the powerful United Auto Workers union.

The plan on the table is believed to involve offering up to 35,000 employees in both companies cash incentives of up to $35,000 (£20,000) to take early retirement.

Delphi went bankrupt last autumn as it lost out to nimbler rivals, especially from overseas. But GM, which employs 325,000 people worldwide and demerged Delphi in 1999, guaranteed worker's pensions and benefits. GM, which yesterday said talks were continuing, has estimated it could be landed with a bill for $12bn if it failed to reach a settlement.

Delphi's management want to slash wages and reduce headcount from 33,000 to about 10,000 to try to get the business back on its feet. GM, which is already planning to shed 30,000 US employees and freeze pension benefits, wants to cut its "jobs bank", a pool of employees laid off on full pay whom it can call on to return.

If a deal with unions cannot be reached by Friday next week Delphi's board has said it would ask the federal bankruptcy court to annul its staff contracts, a move unions have warned would lead to an all-out strike.

The problems at Delphi have raised fears that GM, the world's largest car manufacturer, could go bust. Ron Tadross, the Banc of America analyst who caused a stir at the time of Delphi's collapse when he said there was a 30% chance GM would also be brought down, now believes this is "more likely than not".

The talks come as GM, already under investigation by the Wall Street regulator for accounting irregularities, has become embroiled in another accounting scandal. Late last week it admitted it would have to restate accounts for the past six years and its 2005 loss would be about $10.6bn, $2bn more than it had predicted.

WoW Warren Buffett
he doesnt make it look dark, he's very good---
Buffett predicts erosion of dollar.. Warren Buffett, who posted Berkshire Hathaway Inc.'s first annual losses from foreign currency investments last year, is still predicting the U.S. dollar will erode.
"I think over time the dollar will weaken," Buffett told reporters after ringing the opening bell at the New York Stock Exchange on Monday. "I have no idea if it'll be this year or five years from now."
Buffett, chairman of the insurance and investment firm, has been betting the U.S. trade deficit would weaken the nation's currency since 2002. The 75-year-old also said he hopes his retirement "isn't too soon" and predicted returns for Berkshire investors would average 6 percent to 8 percent a year.
Buffett attended the opening ceremony to mark Berkshire's acquisition of Business Wire, a distributor of press releases. Shares of Omaha, Neb.-based Berkshire rose $1,100, or 1.2 percent, to $89,900 in NYSE composite trading today.
Between 2002 and 2004, Berkshire made $2.96 billion on Buffett's bet against the dollar. Last year the company had $955 million in losses as the U.S. Dollar Index advanced 13 percent.
"It's the consumer action in the end. We have no governmental policies to counteract that we are sending a couple billion dollars a day abroad," Buffett said. "We are buying goods and selling capital."
The deficit in the current account, the broadest measure of international trade, widened to a record $224.9 billion in the fourth quarter, while the trade deficit, a monthly figure, grew to a record $68.5 billion in January, from $65.1 billion a month earlier.
To compensate for the current-account deficit and maintain the value of the dollar, the U.S. needs to attract about $2.5 billion a day from overseas, or about $75 billion a month.
The dollar index, which measures the dollar against six major currencies, has fallen 2.2 percent so far this year. The dollar dropped 2.6 percent against the euro and 1.1 percent against the yen.
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http://www.contracostatimes.com/mld/...s/14149301.htm

WoW! trouble with china---nothing to see here i guess

The head of Caterpillar on Wednesday warned that deteriorating trade relations between the US and China could plunge the global economy into recession and called on Congress to back away from protectionist measures.
Jim Owens, chairman and chief executive of the US heavy equipment maker, spoke as Congress prepares to consider legislation that could impose a range of tariffs on Chinese exports in an effort to slim a trade deficit that ballooned to more than $200bn (â?¬165bn, £114bn) last year. Watched by Carlos Gutierrez, the US commerce secretary, Mr Owens also called on the US to grant China market economy status ahead of the 2016 deadline as a â??carrotâ?� for reforms such as â??a meaningful revaluationâ?� of the renminbi
http://news.ft.com/cms/s/0c33d0d8-b9...0779e2340.html

Will your job servive?

In case you've been worrying about how the war in Iraq will end, or the coming of avian flu, or the extinction of the universe as we drift into the cosmic void, well, relax. Here's something you should really fret about: the future of the U.S. economy in the age of globalization.
In the new global order, Blinder writes, not just manufacturing jobs but a large number of service jobs will be performed in cheaper climes. Indeed, only hands-on or face-to-face services look safe. "Janitors and crane operators are probably immune to foreign competition," Blinder writes, "accountants and computer programmers are not."
http://media.washingtonpost.com/wp-d...032101133.html

UAE, Saudi considering to move reserves out of dollar
http://www.middleeastforex.com/index.php?section=147

Quote:

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Originally Posted by eg420ne

The plan on the table is believed to involve offering up to 35,000 employees in both companies cash incentives of up to $35,000 (£20,000) to take early retirement.

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They just anounced that the buyout would be $140,000. Not to bad for an early retirement!:thumbsup: