Rolling US Economy Into The Shitbin Thread

well, what else is there?? this isn't a metaphysical problem, your car will still exist. try the ignition, yup, still runs.

But this is a part of what Tom is talking about -- GM (for example) doesn't just make cars, it's a giant network of dealers and service shops that you feel (rightly or not) you have a certain track record with, or at least that you can build one. And from a pure consumer psychobabble POV, cars are emotional purchases.

Oh I forgot to say banks, that's part of that network, too.

Light money on fire and then go look for a bucket of water?

Yes, you're right, Don, building much needed infrastructure is exactly the same as lighting money on fire. Strange I hadn't noticed that until you pointed it out.

you misread him completely

Did I? I can't parse it any other way - though I'll admit it doesn't make much sense to me the way I read it originally.

I was about to say, that's not what Don meant at all.

OK, so "postponing the inevitable" is the lighting money on fire? I don't see that that has to be the case. The postponing could take the form of loans that would rank senior to any other claims in the event of an eventual restructuring.

I really don't see the point in that either. Just build new bridges and roads and levees already, stop wasting time worrying about one state out of fucking fifty.

And from a pure consumer psychobabble POV, cars are emotional purchases.

― fiscal liberal (kenan), Tuesday, November 18, 2008 12:26 PM (6 minutes ago) Bookmark

oh barf

Meanwhile today's David Brooks column is LOL-worthy:

They will suffer lifestyle reversals. Over the past decade, millions of Americans have had unprecedented access to affordable luxuries, thanks to brands like Coach, Whole Foods, Tiffany and Starbucks. These indulgences were signs of upward mobility. But these affordable luxuries will no longer be so affordable. Suddenly, the door to the land of the upscale will slam shut for millions of Americans.

http://www.nytimes.com/2008/11/18/opinion/18brooks.html?_r=1&ref=opinion

Won't someone think of the bobos?!

i mean, you're right, they ARE emotional purchases for a lot of ppl, but that to me is part of the problem.

Yeah it can't be that frickin' hard to give government money to companies and write it somewhere in the contract that they can't pay dividends or executive bonuses with it. Let's do that next time, by all means.

oh barf

Yeah, I know. But the heavily-sponsored American car culture has done a bang-up job of connecting people to their cars in ways they are not connected to other products.

xposts

Loans are not free. They are money, they affect our monetary system, etc. Tombot OTM. There's no sense in having one bailout program there to set up another. That was my original point about lighting money on fire.

xpst

I'm not sure about the wisdom of allowing such a big shock to the system at this moment, when the economy is already reeling. I think it might be worth the side-effects to try and spread out the timing a bit.

That's for Bush to try to fuck up and Obama to try to fix.

It's okay if a few million people lose their jobs and their homes, it's flyover country anyway.

let's wait until the economy has been stagnant for five more years, then it's okay to let horrendous leadership out to pasture. Right now though we need people who haven't a fucking clue how to run a goddamn casino in charge of a big chunk of our GDP.

http://www.nytimes.com/2008/11/18/business/economy/18sorkin.html?_r=1

G.M is using money so quickly that a $10 billion infusion made today would disappear by February. That is why taxpayers shouldn’t fork over a cent, at least until shareholders are wiped out, management is tossed out and the industry is completely reorganized.

this is an interesting bailout alternative.

ive been thinking about this a lot and i still think, at the very least for market stabilization reasons that a "bailout" of some kind is necessary.

Maybe running a dozen car ads every commercial break on prime time network television every day for the last 20+ years is not a smart way to spend your money.

oh, and then there's the bailout bill itself. Parsed nicely here.
http://dealbook.blogs.nytimes.com/2008/11/18/parsing-the-auto-bailout-bill/

^^^^^^^xp

GM SAVED BY ZERO

Maybe running a dozen car ads every commercial break on prime time network television every day for the last 20+ years is not a smart way to spend your money.

Ha, I have totally been thinking this myself lately. "They're still paying for ad time? With what, blood?"

well contracts take some time to unravel. there was an article in the times about GM cutting back on advertising and sponsorship

that bill really isnt going to pass though, don. and there's still a fair amount of disagreement about where the money is going to come from no? and if it comes from TARP that necessitates new legislation.

A good article by Joseph Stiglitz on lessons from the current crisis and how to move forward:

http://www.motherjones.com/news/feature/2008/11/the-seven-deadly-deficits.html

Maybe running a dozen car ads every commercial break on prime time network television every day for the last 20+ years is not a smart way to spend your money.

And yet it seems to work for Toyota... or at least it did until they got into the fullsize pickup market...

I've got more perspective on this than I can really share in a general economy-into-the-shitbin thread, but suffice to say that yes painful rightsizing is the only longterm solution for GM and Ford. And for once rightsizing is really the right term: the enterprises are very simply way too large for their current and future market share to support.

That potentially leaves a lot of empty factories, which the UAW ain't having. Hence the stalemate of the past 20 years. This nut's going to be very hard to crack, cash isn't going to fix it, and the UAW has shown no sign of willingness to make the concessions that the US industry's long-term health would require (I'm not certain it should - that question is VERY complicated and I just haven't thought it through clearly enough to take a position.)

Chrysler, otoh, was a lost cause before Cerberus stepped. Dudes were actually hiding inventory in parking lots and recognizing it as sales!!! At least burning cash would generate light and heat.

does "job retraining" ring hollow to anyone else? to do hwat, might i ask...

to do hwat, might i ask...

Work at Wal-mart, if they're lucky. xp

RE: David Brooks column

I lol'd at his 'recessions result in lowered hemlines' thing. OH NOEZ!

which retail stores will go bankrupt after nightmarish holiday sales?

my money's on borders

I'm just surprised they haven't gone out of business already.

"which retail stores will go bankrupt after nightmarish holiday sales?"

Best Buy? Comp USA?

chinese democracy will singlehandedly save best buy

Pier 1? It looks like the stock price is already factoring in a bankruptcy.

http://finance.google.com/finance?client=ob&q=NYSE:PIR

lol @ "retraining"
wasn't that promised when NAFTA was shoved thru

Pier 1 seems so stuck in the 80s that I do wonder how it's managed to survive this long.

big markup on wicker, apparently

a longish post from steve coll on how "a rescue of Detroit might help to jump-start a new national-energy strategy".

Krugman on the Chapter 11 option for automakers:

If the economy as a whole were in reasonably good shape and the credit markets were functioning, Chapter 11 would be the way to go. Under current circumstances, however, a default by GM would probably mean loss of ability to pay suppliers, which would mean liquidation — and that, in turn, would mean wiping out probably well over a million jobs at the worst possible moment.

http://krugman.blogs.nytimes.com/2008/11/16/cars/

i like steve coll

fyi he went to a college well-known as the filming location for 'clueless' and 'dont be a menace to south central while drinking your juice in the hood"

haha he wrote something about meeting/hanging out with obama while at occidental

i hope that's what you're referring to so obliquely

max went there too and he is proud fyi

part of a long line of famous alumni including jack kemp, barack obama, KTLA entertainment reporter sam rubin, ben affleck and the dude from scissor sisters

Maybe running a dozen car ads every commercial break on prime time network television every day for the last 20+ years is not a smart way to spend your money.

Brainwashing is the only way for them to sell cars because their product is awful.