December 22, 2007 (LPAC)--Last August, when Cerberus Capital Management began its takeover of the largely bankrupt Chrysler, it was obvious that the only way Cerberus would be able to make its money back would be through the liquidation of Chrysler's assets and the chiseling of its workforce. With the collapse of the global financial system Chrysler's economic condition has worsened and the supposedly deep pockets of Cerberus suddenly look quite barren. Chrysler has announced it will lose $1.6 billion in 2007, and has backed off on its public assertions that it would turn a profit in 2008. The new, Cerberus-installed CEO of Chrysler, Robert Nardelli, said earlier this month that Chrysler will move "very aggressively" to raise $1 billion in cash through the sales of land, plants and other assets, a move which came on top of an announcement in November that it would double to 24,000 its planned job cuts and eliminate shifts at five plants.

Chrysler was already in trouble when it was run by people who knew the auto business, and the speculators at Cerberus haven't got a chance in Hell of making the company profitable, nor is it likely that they will ever get their money back, no matter how many assets they sell. Some observers believe that the real reason Cerberus moved in on GMAC and Chrysler was to protect the value of the hundreds of billions of bonds issued by the auto companies and their finance units; under the guise of helping the auto sector they were really sent in to help the financial markets. Asked at a meeting if the company were bankrupt, Nardelli responded, according to the Wall Street Journal: "Technically, no. Operationally, yes. The only thing that keeps us from going into bankruptcy is the $10 billion the investors entrusted us with." Now, with its own solvency an issue, Cerberus is following Chrysler down the tubes.