Tax Debt Relief

The U.S. would be the worst global financial crisis since generations, Geithner said: “That tackle, requires comprehensive reform. None modest repairs on the edge, but new rules.”

This is the starting shot for a – probably a long and tough – the debate about how the confidence in the U.S. financial system can be restored. Gaps in oversight will be closed, incurring excessive risks are avoided. The proposals come a week before the summit of the world’s 20 most industrialized and emerging countries (G20) in London, where on the future regulation of financial markets is discussed.

Geithner outlined the plans before the Financial Services Committee of the House of Representatives. The relevant laws should be in cooperation with the Congress will be drawn to the many questions his own reform plans. “We now have the opportunity,” said Geith, “and we must act.”

The reforms are expected to power the government, the Federal Reserve and other regulators to expand significantly. They run parallel to efforts to stabilize the banking sector and the economy.

For risks to the financial system as a whole better observe and be able to want the government system-related businesses strictly supervise. This could be a new independent authority will be created. It is also debated, the Fed Fed this role.

Geithner said no to the question of who takes over this task, but made it clear what powers the regulator should have. Thus, the Authority issues are forcing companies to their capital base or to enhance the borrowing limit. Should the institutions in serious trouble, they under state administration can be made.

Among the regulated entities could, for example, bank holding companies, insurance conglomerates and certain hedge funds belong. Whether an enterprise system is relevant, inter alia, be based on the size, degree of indebtedness and dependence on short-term financing on the capital to be determined.

Hedge funds and private equity firms over a certain size will be in the SEC to register and you must provide certain information, such as their business partners. The companies must also focus on inspections by SEC staff members lie in wait. If problems are encountered, the SEC may be the company to the new regulator transfer. “We do not propose that they be regulated like banks,” said Geithner, however, hedge funds. This position could be at the G20 meeting conflicts with countries that are such a widespread call for regulation.

Light in the trading of credit derivatives

Even the market for credit derivatives, the buttons government. The focus is on credit derivatives (credit default swaps, CDS) is particularly in focus. The papers with which investors against payment defaults of securities to hedge, the future only on so-called clearing house transactions. Until now runs most of the trade off, the market is so opaque. If a major market participants fails, as the U.S. investment bank Lehman Brothers last autumn, a number of trading partners being in danger. One or more clearing houses is to absorb counterparty risk by acting as a buyer and seller for each player gets. In the EU until the end of July is such a processing facility to be established.

Geithner called for regulators to consider new rules to consider the banks require, in boom times extra reserves to defend Wirtschaftsflauten upon them. “We must balance our requirements check and see if we – in line with the interests of investors – from companies require that they advance reserve for credit losses are,” said Geithner.

Treasury and FDIC will take care of non-banks

Work is already on a new legal basis by which the government will collapse before the standing Finance Institute, the banks are not under state administration can provide. For these institutions, in future, the Ministry of Finance and the FDIC deposit insurance jointly responsible. They are the companies abgewickeln or in part can sell. Was triggered by the controversy surrounding the insurer AIG, which the state with up to $ 180 billion is based – on the government but still little-through rights. So the group poured millions of dollars in bonuses, leading to a public outcry resulted.

However, the models in the dollar zone is produced. “We start with the new Fiesta 2010 in Cuautitlan in Mexico. An exact number is not fixed yet,” he said. “The Fiesta is not a niche product.”

Fleming Ford is that the crisis in any case survive without government help. “We assume that Ford Europe does not need state aid is.” However, some models of manufacturers move to reduce costs. “We have major volume models such as Fiesta and Ka just renewed, but a few new introductions because of the crisis by up to twelve months after the move back.”

Ford leads by its own account with several interested parties have detailed discussions about a sale of its Swedish subsidiary Volvo. The company was satisfied with the number and quality of potential buyers, said a spokesman. The negotiations, however, could be yet to come. Ford shares quoted in a strong 2.8 percent in the overall market gains.

The producer from Detroit is fighting just as his two major U.S. rivals General Motors (GM) and Chrysler with declining paragraphs, yet still had no state support services. 2008, the group lost $ 14.6 billion, the biggest negative in the 105-year history.

Among the problems faced by GM and Opel Fleming said: “I hope that Opel through the crisis.” He saw no advantage is that a competitor in trouble. “A major problem in the crisis, the supplier structure. Anything that weakens this is bad.”

In the coming days will be U.S. president Barack Obama himself strauchelnden on the future of the U.S. auto industry comment. Everyone must realize that the current business model of the car industry is not able to stay. The U.S. government will further support only available if the car companies to a fundamental reorganization in cooperation with the government were ready.

The Taskforce urges manufacturers a revised approach to 31 March, to decide whether the two car makers to compete to work and additional loans of up to 22 billion dollars make sense.

General Motors is in the planned Jobkürzungen forward. Additional 7500 U.S. workers had approved new severance offers, told the group. This is more than ten percent of the unionized shift in the U.S..

Overall, since 2006 would have approximately 60,500 employees accepted severance offers. The current subjects were mostly already in the next few days, left the company. GM wants to deal with the programs, especially older and comparatively expensive employees separated. For some, according to need new workers at far lower wages can be set.

So far, details of the rescue plan, the Government Commission is not known. Employees of the Task Force had indicated an application for creditor protection is not the goal of the effort. GM has more than $ 16 billion in new aid requests, Chrysler $ 5 billion.

The Wall Street Journal reported that in return the government will formulate further conditions and a clear timetable for the remediation up. The Commission would further cuts of management, unions and creditors require. The assistance would also probably not paid directly to a means of exerting pressure to have.

The German Government maintains its support for Opel from concrete rescue plan for GM-dependent. German Chancellor Angela Merkel (CDU) has rejected an introduction of the state at Opel, but still starting. The German carmaker wants to rescue his mother from the GM to be independent and seek investors.

Recently had already hinted that Washington is not the manufacturer at 31 March would drop. The Task Force will also be the suppliers with $ 5 billion in hand. The company will receive guarantees that products are delivered to be paid. This will also ensure that the car makers continue with the necessary parts are supplied. In addition to U.S. President Barack Obama, the development of hybrid electric cars with $ 2.4 billion to promote. In particular, the future development of better batteries vorgetrieben.

GM has $ 13.4 billion in Notkrediten from the State. A further 2 billion dollars, which the group initially had requested for March, but will now not be needed. With this waiver, the Group also its progress in the restructuring of proof – and therefore the chances of further support from the state increase.

In the last three years at General Motors $ 82 billion in losses accrued, of which $ 30.9 billion in the year 2008. Alone in the fourth quarter of 2008 amounted to minus the producer from Detroit $ 9.6 billion.

Trailing end paragraph

The paragraph goes extremely slow. In the first two months, broke sales of GM alone in the U.S. market in comparison to the previous year by almost half. In March, the sales by GM, according to a similar level as in previous months.

GM CEO Rick Wagoner has repeatedly warned against an insolvency of the group, if the state is not the end of March at the latest new money available. GM plans to clean up the world among other things, the elimination of 47,000 jobs, closing plants and the further separation of the Group brands

Chrysler has $ 4 billion emergency aid the U.S. government will receive and additional $ 5 billion sought. To obtain this support, the partnership with Fiat as central. About Chrysler Fiat wants to access to foreign markets and to technology for smaller and more fuel-efficient cars secure. The Auto-Commission of the U.S. government supports this Alliance, reported the Wall Street Journal.

Of the big three U.S. manufacturers, Ford rejects the government’s support is not necessary, although the company also is in financial difficulties. Ford wants its U.S. business, especially with German models revive. Most products of the Kölner Ford-Werke in the future, even in the U.S. offered. Ford Europe CEO John Fleming said the magazine “Auto Motor und Sport” models Fiesta, Focus and Transit Connect.