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Thread: 6100

  1. #1
    God/dess Deogol's Avatar
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    Default 6100

    That is what some predict the DOW to reach.

    Shadowstats, using statistical measuring as pre-1990 states a 15% unemployment rate NOW.

    Hard times are coming. Very hard times.

    If they let the auto makers go bankrupt - oh man. The end of manufacturing in America.

    Nothing left but retail floor monkey jobs and selling insurance plans to each other.

  2. #2
    Banned Melonie's Avatar
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    Default Re: 6100

    a not so minor point ... PROFITABLE manufacturing of consumer goods in America has been dead for years ! If you look at the details, American manufacturers have actually continued to operate under two business models. The first is gov't subsidies - in the form of defense contractors (and their sub-suppliers) receiving above market pricing via the US taxpayer, in the form of 'favored industries' receiving tax abatements / energy cost subsidies / tax credits / grant money etc. from federal / state / local taxpayers. The second is that some companies who were incredibly profitable in the past have been able to continue operating at an 'objectively measured' loss via the cannibalization of their assets, as well as by the assumption of ever increasing levels of debt.

    If the Big 3 are allowed to go bankrupt, it will force America to finally acknowledge the truth of the situation ... and perhaps to then examine the reasons behind the situation ( i.e. WHY it's has become almost impossible to operate a profitable manufacturing industry in America over the past couple of decades).

    Of course the 'tin foil hat' crowd would tell you that there are many who will be glad to see the end of American manufacturing !!!

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    Default Re: 6100

    this time next year
    it will be just a bad memory

  4. #4
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    Default Re: 6100

    the big three will be bailed out their too big to go broke
    maybe the japs will buy them !!!!!!!!!

    TORA TORA TORA!!!!!!!!!!!!!!
    LMAO

  5. #5
    Senior Member Butrcup98's Avatar
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    Default Re: 6100

    Could someone please explain to me why the car manufacturers are going bankrupt. People use cars today more than ever. It's almost impossible in my area to get people to walk anywhere, including the corner market.

  6. #6
    God/dess Zofia's Avatar
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    Default Re: 6100

    Quote Originally Posted by Butrcup98 View Post
    Could someone please explain to me why the car manufacturers are going bankrupt. People use cars today more than ever. It's almost impossible in my area to get people to walk anywhere, including the corner market.
    There are short term reasons and longer term reasons why the Detroit three are in trouble. Short term, buyers and GM and Chrysler, LLC are having a difficult time getting credit. If buyers cannot get financing, then they cannot buy the cars sold by any auto maker. If GM and Chrysler cannot get financing, they cannot cover their operating losses. (This is called cash flow insolvency.) Thus, the short term credit crisis is having a great effect on automobile sales. (Ford is less impacted by the credit crisis because Ford concluded a huge loan last spring and has enough cash on hand to go through 2009.)

    However, there are long term reasons why GM, Ford and Chrysler, LLC are in trouble. All three have a poor product mix and high cost structures. Union contracts mean it is difficult for the D-3 to cut costs by any means other than offshoring their manufacturing process. The D-3 cannot simply build new plants and hire a new work force as Toyota and Honda have done in the US. For the D-3 to survive, they will have to reach agreement with the United Auto Workers to lower wages and ease work rules. They will have to close plants to more closely align production capacity with demand for their products. They will probably have to reach some kind of agreement with the government to institute national health care so they they do not have to pay for all their employees and retirees medical costs.

    HTH
    Z

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