Sunday, July 25, 2010

Car Sales

GM is going to buy a Finance Company and pay 24% over the current stock price so that they can make more sub prime loans (poor credit risks) so they can sell more cars. That’s the way they can become a real profit making company again - make loans to people who are poor credit risks so they can buy /lease their cars. That will be good until the defaults start. Can you say “another bailout” boys and girls? On the upside, it will help the used car market when all these cars are re-po’d and hit the secondary market. Might even help the ratings of that TV show.

This mess started because people were getting mortgages that were bad credit risks. Here we go again. And who thinks this is a good idea?

The CEO of GM was put in place by the US Government who owns 61% of GM. Think the Gov’t had a voice in this despite what the article says (Yahoo News being a notorious First Dope supporter)?

So, once again the Gov’t is encouraging a plan to give money to people to buy things they can’t afford. (Einstein: An idiot is a person who does the same thing over and over and expects different results.) Giving people with bad credit the ability to buy a new car is another way of redistributing wealth. If you can’t afford a new car or a new house of a flat screen TV, the best thing for the economy is to not buy it.

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