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Ooo- here's another angle.
What about the NEGATIVE financial impact to charities and buy-here-pay-here car lots who will NOT be able to receive or sell those cars that have been crushed.
750,000 cars worth $3000 each = $2.25 Billion loss in sales to those agencies.
Snowdoggie wrote:Yep. We are doing a good job of using AMERICAN taxpayer's money to keep Japanese and Korean Companies solvent. I guess that is called 'globalism'.
Or keep about the dozen or so people(Americans) I know employed by "foreign" car companies in American producing cars. Foreign companies and their solvency provide food for dinner for many american families. Don't discount that.
http://www.automotivedigest.com/content/displayArticle.aspx?a=55946 <-- So when this article was written (around 2002) Foreign carmarkers had spent $22.6B in this country building plants. Now this list is old and is missing at least 3 Toyota plants, a Hyundai plant, another M-B plant, atleast 2 Nissan plants and hundreds, maybe thousands of suppliers that have grown up around them.
Just because a company has its headquarters here dosen't mean they have any loyalty to anything except their shareprice. We who were or are in the industry have a different view of the program.
just like the farmer has a different view on corn subsidies.... People in the auto industry are very thankful for this boom.
ignorant wrote:Snowdoggie wrote:Yep. We are doing a good job of using AMERICAN taxpayer's money to keep Japanese and Korean Companies solvent. I guess that is called 'globalism'.
Or keep about the dozen or so people(Americans) I know employed by "foreign" car companies in American producing cars. Foreign companies and their solvency provide food for dinner for many american families. Don't discount that.
http://www.automotivedigest.com/content/displayArticle.aspx?a=55946 <-- So when this article was written (around 2002) Foreign carmarkers had spent $22.6B in this country building plants. Now this list is old and is missing at least 3 Toyota plants, a Hyundai plant, another M-B plant, atleast 2 Nissan plants and hundreds, maybe thousands of suppliers that have grown up around them.
Just because a company has its headquarters here dosen't mean they have any loyalty to anything except their shareprice. We who were or are in the industry have a different view of the program.
just like the farmer has a different view on corn subsidies.... People in the auto industry are very thankful for this boom.
...while those of us who do not work in the industry and who will be financing this little boomlet with interest for the next 20 years might not be, and even those of you who work in the industry might not be so thrilled next year when the market for new cars comes back down to earth.
In fact, the guy who gets sucked into buying a car by the Cash for Clunkers media circus going on right now might not be to happy the next day when he wakes up with 60 months of payments and a not too secure job. It will be kind of like a hangover.
In the long term, you can never borrow your way to prosperity.
Snowdoggie wrote:In the long term, you can never borrow your way to prosperity.
Tell that to my buddy who took out a loan to by $80k gold on margin right before it spiked. He made out with over 6 figures in profit.
dlmater wrote:Just my opinion:
The government cannot offer anything to someone it hasn't taken from someone or somewhere else. All we are doing is redistributing money. Sometimes that is warranted, but in this case I think the money is better spent elsewhere...or more importantly not spent at all.
Keep in mind, our federal governement is operating under a tremendous deficit. Every program/bailout/stimulus package enacted does so using borrowed dollars that will have to be paid back with interest later. You cannot spend your way out of a recession. I am afraid we are ignoring the long -term macro economic consequences to ease short-term micro economic pains of select individuals (companies included).
We cannot afford the federal programs we have now, much less all these "new" programs. Remember the Medicaid/Medicare issues? We could not afford that program as was designed during the "good" years. It still needs to be fixed but we are talking of adding universal health care on top of it. We can no longer afford being the world's police force either while at the same time trying to take care of all the domestic issues at home. We need to make some hard choices.
The economy as a whole is not recovering because of the federal government's stimulus/bailout programs. Those are a drop of water in an ocean. We are only helping some very select groups prolong the inevitable. We need to make some hard choices and cut back on government spending to retire some debt in the long term. Or else the US will end up in far worse economic condition then we have seen to date.
A little off-topic, but I feel better now.
I believe that you are absolutely correct. You may feel better now, but I feel worse,
I just want to clarify, I'm on the fence about this program. I'm trying to give you all another perspective.
I'm with ignorant on this one. I'm not sure how I feel about this yet. Only time will tell if the program succeeds in it's goals.
A benefit we will see are more efficient cars on the road and therefore less oil and gas consumption.
ignorant wrote:Snowdoggie wrote:In the long term, you can never borrow your way to prosperity.
Tell that to my buddy who took out a loan to by $80k gold on margin right before it spiked. He made out with over 6 figures in profit.
I've watched enough Sopranos that I know borrowing money to gamble with can bite you in the ass...
Consider this:
Currently only $100,000,000,000 of the funds for the "Economic Stimulus" have been paid out (out of $800,000,000,000)
If the economy turns upward, and we have only spent $250,000,000,000 and the "Bailout Buddies" repay their $100,000,000,000 would it make anyone feel any better?
Sure.
Are you expecting that?
Because while you are hypothesizing the idea that we don't even spend the majority of the initial bailout funds, Congress is debating additional bailout funding, more than doubling the amount.
Using less half the amount already approved seems to me to be grossly implausible.
But yes, I'd feel better.
God I think we will need to add six zeros to the big number personally. I was just stating some numbers that were bandied about this morning.
Random thought per a discussion with a friend last night:
I'd have to guess insurance companies and banks are making out like berkeleying bandits on this one as well.
Think about it:
What kind of insurance coverage do you have on your 1997 Ford Exploder? Before I ran mine through the auction last year, I had the absolute bare minimum (liability) per GA state law. Cost me 15 bucks or so a month. Did I have a loan on said Exploder? Of course not. I paid $1k cash for it.
Now if I went out and bought or leased a NEW car with all of my "free" money, I'd have to get full coverage, plus pay for financing.
Just thinkin' out loud. Perhaps this is not only an "automobile industry bailout" but a "instead of having to push for more stimulus money for our best buddies in the automotive, insurance, and finance industries, lets just slip them some cash under the table" plan.
(flounder) Of course, I probably just heard that on some right-wing talk radio show, because I'm incapable of forming my own thoughts and opinions, and all my anger is "manufactured," right? (flounder.)
Tim, I want to be able to push Poopys post to eleventybillion... board is broken
ignorant wrote:Snowdoggie wrote:In the long term, you can never borrow your way to prosperity.
Tell that to my buddy who took out a loan to by $80k gold on margin right before it spiked. He made out with over 6 figures in profit.
Borrowing and gambling are two different things.
You guys know the TARP aka Stimulus money isn't spent right? In fact some of it has already been paid back. It seemed banks were in a real hurry to pay the goverment back once they limited CEO salaries as part of the conditions of the loan. TARP has funds left. No need to "beg" for more.
To say that the "gub'ment" needs to spike car sales to float stimulus money to the banks and insurance industry is a bit far-fetched.
The data point we all know is that car sales in the U.S. affects many industries. This fact isn't lost on anyone with a brain. But to frame this as some vast government conspiracy seems like an exercise in Glenn Beckness. Glenn Beckness being defined as seeing conspiracies everywhere as opposed to where they potentially exist.
As I said before, we won't know the true effect of this program for years. Could be that this program has uncorked pent up demand for cars that people were not buying because of economic factors outside their control like tight fisted banks not approving loans, job uncertainty, or new car cost being too high for some and now remedied by up to $10k off a new car.
At least we have the benefit of Habeas Corpus back! (Flounder)
..and now that I've posted the above...Check out this article from Reason.com
Since I've been a responsible citizen, am not over my head in debt, have a retirement plan in place, spend reasonably and have NO vehicles that even qualify for the CARS program, when do I get my cash back?
Xceler8x wrote:You guys know the TARP aka Stimulus money isn't spent right? In fact some of it has already been paid back. It seemed banks were in a real hurry to pay the goverment back once they limited CEO salaries as part of the conditions of the loan. TARP has funds left. No need to "beg" for more.
To say that the "gub'ment" needs to spike car sales to float stimulus money to the banks and insurance industry is a bit far-fetched.
The data point we all know is that car sales in the U.S. affects many industries. This fact isn't lost on anyone with a brain. But to frame this as some vast government conspiracy seems like an exercise in Glenn Beckness. Glenn Beckness being defined as seeing conspiracies everywhere as opposed to where they potentially exist.
As I said before, we won't know the true effect of this program for years. Could be that this program has uncorked pent up demand for cars that people were not buying because of economic factors outside their control like tight fisted banks not approving loans, job uncertainty, or new car cost being too high for some and now remedied by up to $10k off a new car.
At least we have the benefit of Habeas Corpus back! (Flounder)
Oooof! Comparison to Glen Beck!? That HURT! YOU KNOWZ THAT GOING ON THE CARS.COM WEBSITE WILL GIVE OBAMA ACCESS TO YOUR COMPUTER, RIGHT!?!?!?
Again, I was just thinking out loud. All three industries have big mother berkeleying lobbying power, (and obviously, it's not just the dems 'scratching their backs' in return.) All three industries get bailout money. Curious.
PS: TARP and the "stimulus" bill are two different animals, btw.
WilD wrote:ignorant wrote:Snowdoggie wrote:In the long term, you can never borrow your way to prosperity.
Tell that to my buddy who took out a loan to by $80k gold on margin right before it spiked. He made out with over 6 figures in profit.
I've watched enough Sopranos that I know borrowing money to gamble with can bite you in the ass...
Ok I'll put it this way..
I own a business that makes widgets. I can produce 500 widgets a day. I have orders for 750 widgets a day. I need a new machine that costs $XXX,XXX to make 750 widgets a day. Because I'm a small business I don't have the capital on hand to purchase the new machine. How do I grow my business without borrowing the money? Assume that the machine I want to buy is used and available at the cheapest price. If I wait on my hands long enough the 250 extra orders I have per day will go to another company and I've lost customers for life.
You can borrow your way to prosperity.. It's freaking easy.
Still gonna have to disagree.
That's not borrowing your way to prosperity, that's borrowing capital to invest in your business.
The prosperity will be generated from the WORK. The borrowing will COST you.
SVreX wrote:Still gonna have to disagree.
That's not borrowing your way to prosperity, that's borrowing capital to invest in your business.
The prosperity will be generated from the WORK. The borrowing will COST you.
I disagree with you disagreeing. Cause how do you do the work to produce the parts without borrowing.. You can't
so therefore you are borrowing your way to prosperity...
And in the small business example you cant just borrow and magically get prosperity without work. So the term would have to be borrow and work your way to prosperity.
ignorant wrote:SVreX wrote:Still gonna have to disagree.
That's not borrowing your way to prosperity, that's borrowing capital to invest in your business.
The prosperity will be generated from the WORK. The borrowing will COST you.
I disagree with you disagreeing. Cause how do you do the work to produce the parts without borrowing.. You can't
so therefore you are borrowing your way to prosperity...
no guarantee that margin increases with production. are you not prosperous at 500 widgets per day?
ignorant wrote:Ok I'll put it this way..
I own a business that makes widgets. I can produce 500 widgets a day. I have orders for 750 widgets a day. I need a new machine that costs $XXX,XXX to make 750 widgets a day. Because I'm a small business I don't have the capital on hand to purchase the new machine. How do I grow my business without borrowing the money? Assume that the machine I want to buy is used and available at the cheapest price. If I wait on my hands long enough the 250 extra orders I have per day will go to another company and I've lost customers for life.
You can borrow your way to prosperity.. It's freaking easy.
The difference here is the orders are in concrete and the purchase of the equipment is a "Guaranteed profit maker", how does that compare to selling old inventory off the car lots.
In addition you must consider, should the extras Widget orders fail to materialize or stop after a couple of months will you go broke due to the new equipment payments.
Then you factor in the extra staff, the taxes, workmans comp etc, holiday pay, 401 contributions, Obama's tax for making in excess of $150K becomes a factor.....is it worth the risk.
Not so easy really
Oh and I would be searching eBay and Craigslist for the equipment first because I'm a Grassroots kinda guy............
Bobzilla wrote:Since I've been a responsible citizen, am not over my head in debt, have a retirement plan in place, spend reasonably and have NO vehicles that even qualify for the CARS program, when do I get my cash back?
Well done comrade.
Thank you for your contributions to the "common good."
