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Obama Cripples Ford's Funding, Then Subsidizes It


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American Spectator:


Just days after Obama signed the Dodd-Frank so-called financial reform bill (here is my general overview for TAS of the Dodd-Frank monstrosity), Ford found that it couldn't issue a bond to allow it to finance more credit for its customers. The reason, as reported by AOL Daily Finance, is that Dodd-Frank "fixed" the problem of poorly researched credit ratings by designating the three big rating agencies as "experts" subject to the same liability as professionals such as auditors. Since the Securities and Exchange Commission requires that bond offerings have a credit rating, Ford's venture became a no-go.

The SEC fixed this problem temporarily by allowing Ford and other companies to issue bonds without rating for six months. But after that, according to experts quoted in the article, the trouble will resume unless there is a permanent fix to Dodd-Frank's "fixing" of the credit rating system.

It is not known if Ford's decision to take this government money -- after honorably refusing a TARP bailout when it was offered two years ago -- is related to expected regulatory troubles in the bond market.
But what is predictable is that the more frustrating the obstacles the government puts in front of businesses, the more some firms will come crawling to the government for bailouts -- and the more that firms will kowtow to the prevailing government's agenda and be politically connected, should they ever need this lifeline.snip
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I guess this is another example of how Zero and his policies have "saved" Ford Motor Company by propping up its competitors. Seems that GM and Chrysler, now quasi-governmental agencies, are immune from these regulations.

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I'm sort of surprised any thing out of that law would take affect so fast. Usually the law tells the secretary of whatever to implement the actual wording and dates are set further out in time to allow people time to get ready. Also not sure what the author means by Ford taking gov money as it appears the gov just let them borrow money on open markert as they had planned.

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