With regard to the proposed Detroit bailout, I find it curious that most people have accepted that it needs to be all or nothing – that either General Motors, Ford and Chrysler should all get government money, or none of them should.
Since my column last week noting the reasons why a Detroit bailout would be a bad idea, the mood has become more hostile to the idea (I am not, by the way, claiming any causality: lots of other people argued against it).
But the argument has generally turned into a three-way bailout versus none at all. So I want to reiterate my suggestion that the US government provides some finance to GM and Ford while letting Chrysler go bust. Read more
Tyler Brûlé is opening a shop.
Adolf Merckle lost a lot of money by shorting Volkswagen. Read more
Rupert Murdoch has blown hot and cold on President-elect Barack Obama, and is still doing so, to judge by the tone of his media outlets.
The New York Times has an article this morning pointing out that the New York Post has been displaying a lot of warmth towards Mr Obama since the election, although it did not take such a friendly line before November 4.
Meanwhile, Fox News is apparently unrepentant about its hostility towards Mr Obama on shows hosted by figures such as Sean Hannity and Bill O’Reilly. Fox News is run by Roger Ailes, who does not appear to be a fan of Mr Obama. Read more
Lloyd Blankfein’s decision not to take an annual bonus for 2008, along with other senior executives at Goldman Sachs, surely closes the door on big bonuses for top investment bankers across the industry this year.
Given that Goldman has performed better than any other big investment bank – and than many smaller ones – during the financial crisis, it would be perverse for others to try to force open the door that has been slammed by Mr Blankfein. Indeed, UBS has already fallen in line with Goldman.
Defying the precedent would be risky in various ways. Citigroup’s disclosure this morning that it will cut 50,000 jobs as part of an effort to slash its cost base by 20 per cent shows how much the sector is suffering. That makes largesse at the top tactless. Read more