Making Lemonade

So, it appears they are going to bail out our auto companies big time. From the WSJ:

Some proposals would offer another $25 billion in low-cost government loans, on top of the $25 billion Congress authorized previously...Rep. John Dingell (D., Mich.) emerged from the meeting calling it one of the most productive of his career and said "the end result would be a good one from the standpoint of the auto industry."

Of course, by auto industry he means UAW, because they are really the only ones making money. Specifically,

The UAW is backing a plan to have the government put money into trusts the auto makers and the UAW established to pay for UAW retiree health care.

So the money bypasses the companies, goes right to the union! Sweet.


But, on the other hand, $50B is a lot of money, meaning that even after, say, $20B for union pensions, Ford and GM will be around for a long time as a great short for equity players. There will always be some suckers out they, so they can lend me their shares.