Monday, March 30, 2009
Fedreal government finally realizes
That U.S. car companies are broke. All the money in the world isn't going to put humpty back together again. Why? Because buyers if there are any left can't get a loan even if they have perfect credit because banks aren't lending. Dealers can't pay the loans they have if they don't sell cars. Giving a $7500 tax credit for buying a car won't help if the credit isn't there. What did the banks do with their bailout. They did just what you or I would do. They paid down their debt and are holding the rest for future losses. Credit still remains frozen. With the job market tanking further squeeze comes from both sides.
With six down quarters I'd say it's safe to say we're in a depression. The way out? With corporations not spending and lay offs adding to the problem and no consumer demand there is no choice but for the government to step in and spend. Hopefully the spending on infrastructure will get things going long enough for the debt to be worked out of the systems. That along with savings should bring about a balance. At least that seems to be the plan. One thing is for certain. This generation will never look at life the same way much like our parents did with the great depression.