Cash for Clunkers.....

[revhead347]

I'm not arguing that they are right or wrong, or whether or not it's going to work, I was just explaining the logic behind it. Most people have already made up their minds on whether or not it is going to work or not, and will perceive future economic changes in a way that supports their predetermined mind set. The average recession lasts 7 years. In my opinion, if we see noticable economic changes by this time next year, then I would agree that it worked. If we go full term to 7 years, and nothing changes, then I would say Obama wasted a bunch of everyones grandkid's money. I'm not going to try and justify it, especially on a car forum.

Kurt

 

[revhead347]

sounds eerily like Clinton's magical program that allowed people with crap credit to buy $600K houses with no down payment. How did that end?

This is a common misconception spread through the internet rumor mill. Clinton invented no such program. The leading sub prime lenders, Fannie May and Freddie Mac were formed in 1934 by the government to support the American Dream of everyone owning their own house. The only thing Clinton did was support legislation prohibiting lenders from discriminating against applicants for race, sex, etc. Somehow this housing crisis was blamed on subprime mortgages failing, which is not really true either. Sub-prime mortgages represent 20% of the total number of mortgages in the US, and represent 37% of the foreclosures in the recent housing crisis. Those numbers don't sound too unusual, because sub-primes are suposed to have a higher foreclosure rate, and that's why lenders charge more interest on those loans. That means that 63% of the failed mortgages in the housing crisis were your conventional style mortgages. However, I do believe that innapropriate lending practices did lead to the crisis. It has very little to do with people buying what they couldn't afford though. 95% of these homes were already built, large or small. The lower qualification standards for mortgages causes a spike in home values which led to people having to borrow more money to get into the houses appropriate for their family and location. Lenders had to get creative to cover the higher mortgage values; using Adjustable rates and balloon payements. It's a vicious cycle. I think the bottom line on the mortgage crisis was the gap in income to inflation in recent years, and the steady decline of the GDP. It's hard to keep paying your mortgage, when your income remains the same, and all your other expenses increase. I think this is the logical explanation because most of these mortgages were over 6 years old. People suddenly became unable to pay for what they had been steadily paying on for 6 years. Sounds like the candle was burning at both ends, and a lot people finally ran out of wax.

Kurt

 

[revhead347]

I don't have a 401k. The big picture is Obama and the gov't are ****ing me. And Ford is better off, because it's not owned by our gov't, they have their own debt and own loans. GM isn't borrowing money from the gov't, THEY'RE OWNED BY THEM.....isn't that called communism?? 700 billion to banks, and they don't know what happened to most of it.....the gov't owns what was the worlds largest automaker for something like 40 years, this is a joke. 3 billion dollars for people to buy new cars....that I'm going to pay for, I don't get an new car, I don't get a better place in life, I don't care about A-hole CEOs getting 7 digit payouts.....what I do get is a tax increase. Anyone buying into this obama saving the economy is ignorant; he's ruining our future, our childrens future, and their childrens future with this increased debt he's putting on America.

"Ignorant" is a word used by the weak minded. You have to accept that there are people much more intelligent than either of us supporting both sides of the argument. That is to say that there are Harvard and Yale grad democrats who can see the logic behind the current administration and support it. Since these people are more intelligent than myself, I would not call them "ignorant." I would just simply say that I do not agree with them. People who use the word "ignorant" also frequently use the words "Communism," and "Socialism," as a scare tactic. Communism and Socialism are two words representing an economic theory that has never entered into practice anywhere in the world. People in China go to work, just like we do, they get a paycheck, and they pay taxes. There are rich and poor people in China, just like here. When you look at the details of the socio-economic structure of a so called Capitalist country, and a so called Socialist country, you are pretty hard pressed to find any substantial differences. They are just words.

GM has entered into a contract with the government, where the government has given a loan, and for the duration of that government loan, they will hold the majority of GM stock. There is language in that contract legally prohibiting the government from retaining long term ownership. I don't know the details of the contract. I know the end result of the contract with the Chrysler corporation is the majority holdings being transferred to the UAW. That means the workers building the cars will own the majority of the company. Doesn't get much more American than that.

Kurt

 

[Black95GTS]

"Ignorant" is a word used by the weak minded. You have to accept that there are people much more intelligent than either of us supporting both sides of the argument. That is to say that there are Harvard and Yale grad democrats who can see the logic behind the current administration and support it. Since these people are more intelligent than myself, I would not call them "ignorant." I would just simply say that I do not agree with them. People who use the word "ignorant" also frequently use the words "Communism," and "Socialism," as a scare tactic. Communism and Socialism are two words representing an economic theory that has never entered into practice anywhere in the world. People in China go to work, just like we do, they get a paycheck, and they pay taxes. There are rich and poor people in China, just like here. When you look at the details of the socio-economic structure of a so called Capitalist country, and a so called Socialist country, you are pretty hard pressed to find any substantial differences. They are just words.

GM has entered into a contract with the government, where the government has given a loan, and for the duration of that government loan, they will hold the majority of GM stock. There is language in that contract legally prohibiting the government from retaining long term ownership. I don't know the details of the contract. I know the end result of the contract with the Chrysler corporation is the majority holdings being transferred to the UAW. That means the workers building the cars will own the majority of the company. Doesn't get much more American than that.

Kurt

I spent the first 2 weeks of April in Beijing, then down south to Nantong City for 5 days, then east to Shanghai for a day, then south to Pintang Island for 4 days. Working in China IS NOTHING like working here. Unless you have also worked in China and have a different point of view from the experience then I do. The Government supplies nearly everything, everyone relies on social programs and tries like hell to live in the city because the further from the government you get, the less programs you benefit from. To live in Beijing or Shanghai, you have to be able to trace your lineage back to older families from the area. So unless you want what social programs you get to be based off of how far back you can trace your family tree, then I don't think China is an appropriate aspiration for American workers.

Clinton created the mortgage crisis by repealing the Glass-Steagall act of 1933. The Glass-Steagall act, among other things, created the Federal Deposit Insurance Corporation, FDIC, which limited banks ability to speculate with mortgages and also prohibited bank affiliated holding companies from owning other banks.

Clinton gave the pen he used to repeal the act to the president of Citigroup. Were there other factors involved? Of course, but that singular act is what in my mind started the chain reaction.

Adam

 

[Chythar]

Clinton created the mortgage crisis by repealing the Glass-Steagall act of 1933. The Glass-Steagall act, among other things, created the Federal Deposit Insurance Corporation, FDIC, which limited banks ability to speculate with mortgages and also prohibited bank affiliated holding companies from owning other banks.

I went and looked this one up, and Adam is correct on Clinton signing the repeal into law. However, the Republican Congress pushed it through on party lines so IMO both political parties are "at fault". I would also agree that the repeal of this act helped set up the current economic crisis.

I dunno about the pen part, IMO it's irrelevant.

One thing about all economies, they live and die on people spending. If enough people spend money, the economy grows. If enough people save money instead, the economy will shrink. The old economy was built upon credit rather than actual money spent, so it was one big bubble just waiting to pop on any one factor. The sub-prime lending fiasco happened to be the pin that popped the bubble, but there were plenty of other factors that could have killed the economy.

This is the way I see the Cash for Clunkers program and the other stimulus packages that the administration is tossing out there. Yes, they are mortgaging our future for the present. How different is this than any other administration? Bush Jr did it, so did Clinton, Bush Sr and most of the Presidents before them, for whatever reasons they found at the time. In this case, the administration is trying to get folks spending again. Yes, folks will likely be spending money they don't have. But that's a different problem. If enough people spend money, the economy will grow again; businesses will make money, they will buy products to sell, hire employees, etc. Which also makes more money flowing into the government's hands, a handy "side-effect".

Once economic growth is restarted, then debt reduction can be looked at. Without growth (and more tax revenue), paying off the debt will either involve more taxes or cutting programs, which no one wants or can afford.

Is the Cash for Clunkers system perfect? Heck no. Will it fix the economy all on its own? Of course not. But if it turns out to help boost the economy a little bit, the administration can try other similar programs to keep boosting the economy little by little until it grows on its own.

Want a car analogy? You were out for a Sunday drive, and while you were busy staring at a hot chick your foot slipped off the clutch and stalled your 'Stang. (economy bubble burst). How embarrassing. Just your luck, your starter has just failed (banks failing, no credit available). Now, you could just wait and see if your starter will decide to work (no gov't stimulus) (very unlikely), or you could try to push-start it (gov't stimulus) (might work if you can get the car rolling).

IMO, the gov't is at least trying something to get the economy rolling again. Sure beats sitting around and letting that hot chick get away.

 

[Zero Signal]

I don't see what the big deal is. They spend $3b on this. Didn't AIG get something like 30 times that from the government? In the grand scheme of what the government is spending (trillions), the CARS program is a teeny tiny eensy weensy drop in the bucket.

 

[revhead347]

I spent the first 2 weeks of April in Beijing, then down south to Nantong City for 5 days, then east to Shanghai for a day, then south to Pintang Island for 4 days. Working in China IS NOTHING like working here. Unless you have also worked in China and have a different point of view from the experience then I do. The Government supplies nearly everything, everyone relies on social programs and tries like hell to live in the city because the further from the government you get, the less programs you benefit from. To live in Beijing or Shanghai, you have to be able to trace your lineage back to older families from the area. So unless you want what social programs you get to be based off of how far back you can trace your family tree, then I don't think China is an appropriate aspiration for American workers.

Clinton created the mortgage crisis by repealing the Glass-Steagall act of 1933. The Glass-Steagall act, among other things, created the Federal Deposit Insurance Corporation, FDIC, which limited banks ability to speculate with mortgages and also prohibited bank affiliated holding companies from owning other banks.

Clinton gave the pen he used to repeal the act to the president of Citigroup. Were there other factors involved? Of course, but that singular act is what in my mind started the chain reaction.

Adam

Just saying that the big things always remain the same. No country is totally socialist, or totally capitalistic. Obviously certain places are going to lean more to one side or the other. The government naturally distributes wealth. That's what the graduated tax structure does. I honestly haven't kept up with too much of this stuff since Obama took office. I feel bad about it, but after buying this house, all my free time is spoken for.

Kurt

 

[KamiKaziDK]

"Ignorant" is a word used by the weak minded. You have to accept that there are people much more intelligent than either of us supporting both sides of the argument. That is to say that there are Harvard and Yale grad democrats who can see the logic behind the current administration and support it. Since these people are more intelligent than myself, I would not call them "ignorant." I would just simply say that I do not agree with them. People who use the word "ignorant" also frequently use the words "Communism," and "Socialism," as a scare tactic. Communism and Socialism are two words representing an economic theory that has never entered into practice anywhere in the world. People in China go to work, just like we do, they get a paycheck, and they pay taxes. There are rich and poor people in China, just like here. When you look at the details of the socio-economic structure of a so called Capitalist country, and a so called Socialist country, you are pretty hard pressed to find any substantial differences. They are just words.

GM has entered into a contract with the government, where the government has given a loan, and for the duration of that government loan, they will hold the majority of GM stock. There is language in that contract legally prohibiting the government from retaining long term ownership. I don't know the details of the contract. I know the end result of the contract with the Chrysler corporation is the majority holdings being transferred to the UAW. That means the workers building the cars will own the majority of the company. Doesn't get much more American than that.

Kurt

I'm going to ignore the fact you imply I'm weak minded because of my use of words describing a person or persons. I call people douche bags too, does that categorize me as something else also? And going to an expensive college doesn't make one smart, while I would argue a majority of them are more book smart than the median, they're no smarter than you or I. Communism has been put into practice, but it's a failed system because the leaders won't practice what they're promoting. Communism works for 3rd world developing nations, or would at least if it were done properly, but once they're at a certain economic level, the system is exhausted and they must advance.

The gov't owns 60% of GM, that's not a contract, it's actual ownership. Like you say, there is a contract for the financial responsibilities of the loans that were originally given out, but there's no 5 year 10 year must sell date for the gov't in the contract. And we can hope that the actual UAW workers get to see most of that stock go to them, but we know that the actual UAW will probably hold onto a majority of the stock to get their way with deals and contracts later on. Unions are another good idea with bad leadership I think...... Not all, but a lot of the bigger ones.

 

[revhead347]

I'm going to ignore the fact you imply I'm weak minded because of my use of words describing a person or persons. I call people douche bags too, does that categorize me as something else also? And going to an expensive college doesn't make one smart, while I would argue a majority of them are more book smart than the median, they're no smarter than you or I. Communism has been put into practice, but it's a failed system because the leaders won't practice what they're promoting. Communism works for 3rd world developing nations, or would at least if it were done properly, but once they're at a certain economic level, the system is exhausted and they must advance.

The gov't owns 60% of GM, that's not a contract, it's actual ownership. Like you say, there is a contract for the financial responsibilities of the loans that were originally given out, but there's no 5 year 10 year must sell date for the gov't in the contract. And we can hope that the actual UAW workers get to see most of that stock go to them, but we know that the actual UAW will probably hold onto a majority of the stock to get their way with deals and contracts later on. Unions are another good idea with bad leadership I think...... Not all, but a lot of the bigger ones.

I'm not implying that you are weak minded, but simply that you are using a word that is in the tool box of the weak minded. It's something someone says when they are closed minded, and they want to blow off the opinions of others. Going to an ivy leak college doesn't make you smart, but most of the people who go there have to be smart to get in. That or someone in your lineage gave a grant or something in order to get you accepted. Both George W. and Obama had there ivy league acceptance "arranged."

Anyway, I wouldn't say that Communism has failed, as China is clearly kicking our ass economically. However that success comes at the expense of the standard of living of the citizens. I don't believe the form of government they have in China would be accepted here, because the people here are used to a standard of living. But I guess I just repeated what you said in more words.

Whenever the government does anything, it involves a contract. They own the majority share in GM, which was negotiated in a contract. There are terms in that contract that will facilitate the return of that stock to the public. I don't know the exact terms. They are available on politifact.com though.

Kurt

 

[89gt89]

The good news is...whole lotta Explorer uppers, lowers, and gt40 heads ending up in the local pull a part's. Got 2 sets of intakes and a nice set of 95 heads yesterday $99 out the door.

 

[yukisho]

The good news is...whole lotta Explorer uppers, lowers, and gt40 heads ending up in the local pull a part's. Got 2 sets of intakes and a nice set of 95 heads yesterday $99 out the door.

True for that. I should head out there and see what they have here. Maybe even take a trip down to vegas.