It is irritating that the majority of the vehicles are Japanese.

Sometimes, we're so effin' stupid, it's embarrassing. It's not really about energy, it's about jobs.

It's not really about energy, it's about jobs.

And IMO that is the proper focus.

There won't be a recovery without jobs.

The deal is to allow some amendments to be offered that will be voted down, and then the bill will be passed exactly as it is.

I love democracy sausage - tastes kinda like chorizo.

homedad43 (homepage, profile) wrote on Wed, 8/5/2009 - 10:35 pm

Sometimes, we're so effin' stupid, it's embarrassing. It's not really about energy, it's about jobs.

For TPTB it's all about macroeconomic metrics. Everything else is going to be used as a means to that end.

We all knew this would happen.

What I see is sales people,dealers, admin staff, insurance firms, after market goods all getting a pay check. Yes auto makers will earm too.

Not all bad.

Let's pull as hard as we can, and then we can close up shop. I want to go home.

of 3% SAAR GDP shoots happiness to the moon
I don't think 3 Billion is 3% of GDP

GDD9000 (profile) wrote on Wed, 8/5/2009 - 10:43 pm

shall I continue?

Yep. Goosing the macro metrics is what this is all about.

so what if most of the cars sold are so-called 'foreign'? More incentive for the domestic producers to get on the stick.

We have enormous numbers of poor in this country who could use a car...any car....to get them to work, to the grocery store, to the doctor. Cash for Clunkers was never about helping those in need of help...but it could of been

squidward, you need to study a bit how the national income accts work

sorry homedad. japanese make the best cars.

this program is so beyond stupid.

I agree Polyanna,

I wanted to see a program that gave a larger credit to lower income people. The less you earn the more of a freebe you could get. And many of those people have really old, gas guzzlers.

Parts for decades to keep my gas hogging going strong. Thanks Congress.

TPTB think they've hit on the magic formula. $8000 gets people to take on $200k debt for 30 years and $4500 gets them to go in hock for $18k for 5. And make no mistake the intent is to get people back on the debt treadmill.

Every time I read Cash-4-Clunkers, I think of Cash-4-Kids

Also, regarding insurance, the previous cars CLUNKED needed to be running. They may or may not have been running AND on the road. (im not sure about this, but I dont believe they needed to be registered. If not, they stimulate the towing industry...but I digress)

If they are running, registered, and insured, then the insurance lift isnt as big, because the rate will be higher, but we arent talking about another car on the road spending on insurance.

Comrade Polyanna Greenshoots (profile) wrote on Wed, 8/5/2009 - 10:49 pm

We have enormous numbers of poor in this country who could use a car...any car....to get them to work, to the grocery store, to the doctor. Cash for Clunkers was never about helping those in need of help...but it could of been

We could almost literally have saved the world with $12 trillion... if that money actually existed.

Instead we gave IOUs to gamblers in the vain and naive hope they can make it materialize into cash - because the dirty little secret about that funny money can't get out, no matter what the cost!

If they are running, registered, and insured, then the insurance lift isnt as big,

They had to be running, and titled and insured by the rebatee for at least a year.

wife has some "find your house show" on tv. a fitness instructor and a marketing manager are buying a 525k house for 10% down in 2008. i wonder how they are making out, now.

debt treadmill, indeed.

Judge won't agree to SEC-Bank of America Settlement

In an order on Wednesday, Judge Jed Rakoff of the federal district court in Manhattan said it may be unfair to the public to accept the settlement, which would resolve SEC allegations that Bank of America made false and misleading statements to shareholders about bonuses promised to Merrill employees....

Despite the public importance of this case, the proposed consent judgment would leave uncertain the truth of the very serious allegations made in the complaint," Rakoff wrote in his two-page order.

"The proposed consent judgment in no way specifies the basis for the $33 million figure or whether any of this money is derived directly or indirectly from the $20 billion in public funds previously advanced to Bank of America as part of its 'bailout,'" the judge added.

And make no mistake the intent is to get people back on the debt treadmill.

Cash for clunkers was to bailout the dealers - that and unclog the pipeline at the bottleneck... the END USER. Usually that would signal to Houston there is a problem... but that was the old rocket science... we are beyond that now.

Thanks picosec.

Very informitive numbers. I really like the logicl flow to the chart.

It's a tough global calculation, because it's hard to include the additional energy consumed in manufacturing the new cars. (Smelting is not low-energy, for example.)

But enough of this. I'm giving up my car, I've had it. I'll be the guy waiting for the bus. At least I'll have good tunes.

Rakoff is a good judge.

A huge "fuck you" to the SEC scum.

Every $1B in C4C credit saves America $167M in gasoline (retail) each year (6 years to recover the investment in fuel alone)

And after six years they'll probably still have a car loan to pay off - or at least some will. Oh the irony...

Oh my gawd - check this out : AIG breakup a massive fee generator for wall st.

AIG Breakup Is Fee Bonanza - WSJ.com

Heck WTF else can we break and give the crumbs to wall street. FNM and FRE? Hell, why not?

It is good to be the king...

First comment on this?

"The deal is to allow some amendments to be offered that will be voted down, and then the bill will be passed exactly as it is."

The Senate has picked up on the good bank/bad bank bald-faced fraud as the way to go.
No one is paying attention. The media might be out for a scoop, but if you just tell them you're full of shit, no one notices. Old news anyway.

"Taxes To Toyota"

No surprise there. American econoboxes are, for the most part, horrendous. The Chevy Cobalt is a dog compared to a Civic or Mazda3. Don't even mention Chrysler's entry (Dodge Caliber), a terrible automobile.

homedad43 stated "It is irritating that the majority of the vehicles are Japanese."

debtfree said "Of the 2B$, how much is the stimulation for US economy, if parts are imported and all we do is assemble the cars here?"

You people should be better informed before you spout off.

All of the Toyota Corollas and Camrys sold in the USA are manufactured in the USA. In fact, American manufactured Toyotas have a higher percentage of American manufactured parts than do comparable Fords and GMs.

So which is better for the American economy: to buy a Toyota made in America of mostly American parts or to buy a Ford made in Mexico of mostly Mexican and Brazilian parts?

binko,

to whom do the PROFITS accrue?

to whom do the PROFITS accrue?
the banks.

Are you concerned about profits or jobs?
I'm in the boat that corporate taxes should be RAISED in this environment. Force the companies to spend on labor, expansion, or something rather than to the investor class.

None of this laying off everyone to massage earnings.

In todays Deseret News (one of SLC Utahs two daily newspapers):

George Cassity, owner of First Class Cars on the corner of State Street and 800 South in Salt Lake City, knows someone President Barack Obama should have talked to before he launched the Cash for Clunkers program.
That would be him.
Day in and day out for the past 25 years, George has sold used cars to the American people. Many of those cars are what the government has now officially classified as "clunkers" and is paying up to $4,500 to get off the streets and destroyed.
And there goes George's inventory.
"It's hurting most the very people it should be hurting the least," says Cassity of the scheme to drive new car sales with the way-more-than-they're-worth clunker trade-ins.
"When you take 50 percent of the used-car market off the road, everything that's left is going to go up in price," says George, citing simple supply-and-demand economics. "We're talking about 40 to 50 percent of our population now being put in a position where they can't find a good used car. In a month there won't be any $3,000 cars left. They'll be $5,000 cars.
"It's insane what they're doing. Why don't they also burn down all the old, low-income houses that are out there — it's hurting the same people. And they're the people that voted Obama into office. That's who is getting killed by this."

When nations get bolder, and they despair,
Many years from now,
Will they still be sending me out more times
Mushroom greetings, destruction of life?

If I'd been out past Nagasaki
Would you ask for more?
Will you still need me, will you still fear me,
When I'm sixty-four?

oo oo oo oo oo oo oo oooo
You'll be bolder too, (ah ah ah ah ah)
And if you say the word,
I could stay with you.

I could be handy, mending a feud
When your rights have gone
You can live with fission by the fireside
Sunday mornings, have a half-life.

Being the reaper, digging the graves,
Who could ask for more?
Will you still need me, will you still fear me,
When I'm sixty-four?

Every summer we can get a new colleague
Looking for might, if it's not too dear
You shall scrimp and save,
Countries on your knee:
North Korea, or some rogue state?

Send me in a missile, drop me and i'll do fine,
Stating point of view
Indicate precisely what you mean to say
Yours sincerely, Wasting Away.

Give me your answer, send me behind enemy lines
Yours for evermore
Will you still need me, will you still fear me,
When I'm sixty-four?

YouTube - When I'm Sixty-Four- The Beatles (Sgt. Pepper's Lonely Hearts Club Band)

Anybody know where to find the number of used cars that change hands in an average year?

Fox may just be the first mover... others will follow if they think they can get away with it.

RockyR,

Agreed, it's just demand pulled forward (and debt multiplied). Same thing as when McTeer urged everyone to buy SUVs.

The war over subscription content on the web has already been waged and lost.

"you know, this business about news sites charging is kind of scary. "

More like kind of funny.

Poor people could use these cars to make money. Our government is destroying demonstrably functional capital equipment.

• ' poor people' drive poorly maintained vehicles, usually without insurance.

"It is irritating that the majority of the vehicles are Japanese."

They have a much wider selection of conforming inventory. US Auto's selection of economy vehicles leaves a LOT to be desired. Plus Toyota is already the #1 seller of autos in the USA. In their primary markets, gas is taxed at a much hight rate than in the USA, so they have been concerned about getting the most out of each MPG for a long time. In USA auto, not so much. The long running exclusion of Trucks and SUVs from CAFE standard, put USA Auto at a competitive disadvantage.

BT,

missed your reply. sure the banks take a cut. so do the dealers and the assemblers, and the parts makers, and the rail yards, and the arab oil mongers... but who takes the BIGGEST cut?

interesting ideas about corporate taxation. that won't result in more layoffs or anything. unless, of course, you plan to have government MANDATE how the business recover the lost profits.

Reading between the lines, i'd guess that the other end (advertising) has collapsed somewhat, and only the Brahmin of Bullshit realizes that the only way out is to charge the hoi ploy, but like who's gonna pay for drivel after having been force-fed the slop for free?

[Are you concerned about profits or jobs?}

None of this laying off everyone to massage earnings.

Absolutely agree on the concept, Basel. The real problems, though, are buried much deeper within the IRC.

Eliminating loopholes ought to be some Congresscritter's claim to fame some day soon.

I say micropricing. Just like early pay-per-view TV, when producers got greedy trying to sucker the addicts and rich. But profit could be made with 20 million dimes a day.

picosec, I stepped away earlier and didn't compliment you on your work.

Great analysis and easy to follow spreadsheet. 67 million gallons of gas saved per year strikes me as significant even if it is only 0.05% of what we burn.

OMG . . . we burn that much gas every year? Are we out of our minds?

The dollars may be going to Japan, but that's not real money.

Sticking with the Beatles theme...

Yesterday,
All my payments seemed so far away,
Now it looks as though they're here to stay,
Oh, I believe in yesterday.

Suddenly,
My pension's half the plan it used to be,
There's a shadow hanging over me,
Oh, yesterday came suddenly.

Why'd she
N-O-D I don't know, she wouldn't pay.
I delayed,
Something wrong, now I long for yesterday.

Yesterday,
REITs were such an easy game to play,
Now I need a place to hide my pay,
Oh, I believe in yesterday.

Besides it takes a ton of oil and energy to make a new car. I am skeptical that fuel savings compensates for the energy and petroleum consumed in the manufacture of the car. Also, there is a huge amount of plastic and vinyl in cars that has an environmental cost.

OMG . . . we burn that much gas every year? Are we out of our minds?

• my brother, you don't know the half of it.

Hey Obamamma,

Want some good press?

Give the bleeping cars to single moms.

Speaking of which, Cash 4 Clunkers is probably a disaster for charities that depend on vehicle donations.

However, I never liked that model as there are too many middlemen and little goes to the charity. OTOH at least the middlemen are employed, a novelty in today's economy.

what was that? i think i just heard a brain engage. a good one at that!

Not good press from Fixed News. They'll cry moral hazard, and find one couple who divorced to get a free clunker...

Comrade Coinz - 'dats a good un!

The fact that these cars were destroyed, when they had a value, is atrocious. All they needed to do was plan this better.

The REAL junk cars are the ones people depend on, the ones that the people in books like Nickled and Dimed, or the Working Poor, etc, drive, because they have to. The kinds of cars that break down and ruin their lives, because they cant get to their minimum wage job.

Im sure plenty of the cars that were destroyed would have been a huge step up for many people in terms of transportation, would have made their lives demonstrably better AND would have gotten even MORE fuel inefficient vehicles off the road.

But did anyone for a second even see this considered? Hell no.

those trains don't run on coal... or hope for that matter

Actually they run on electricity. The oil is just used to power the diesel generators. Plenty of other ways to get the electricity, including coal. Actually, I thought I'd heard that there were processes to produce liquid fuel from coal that become economical when oil was about $50/barrel. So no worries. Lots of coal, and we can finally get around to just electrifying the track and powering the rails off nuclear if we really need to.

i disagree. without being able to cite sources, few bloggers can accrue (edit: any) credibility. think about the damage a karl denninger would have on CR if CR couldn't cite once the news providers charge for online content, they can SUE for copyright infringement if you repost. everything would have to be transcribed / transposed... stuff gets distorted in translation.

as for dissecting annual reports... i'll try to stifle my laughter.

Im sure plenty of the cars that were destroyed would have been a huge step up for many people in terms of transportation, . . . .

But did anyone for a second even see this considered? Hell no.

It may have been considered and rejected. The political backlash would have been awesome.

You can't make the poor a privileged class in America without taking a lot of lumps in the process.

"How dumb is that."

Well it makes for some good, short-term numbers that helps keep the green shoots theory alive for one more day. I presume that there hope is that after enough hopium, the "real" economy will get back up and get going. The issue I have with that is there are a lot of topheavy/dead weight banks and businesses (like Fox News) that need a real down turn, or BK, to change business as usual, into something that works, or the web will eat their lunch.

Also, I do not know how long this borrowing in ever increasing amounts to keep the dream alive, is going to work. As soon as they stop... I do not see an effective transition.

Seem a lot like"

1)steal underpants...

WS, trains are currently powered by diesel. i understand the conversion to electric energy for propulsion. have family in the business.

coal liquefaction is, in fact, a great hope for america... IFF we can get beyond the environmental concerns and get some plants sited. but, i agree with you on this technology for sure! btw, hitler used coal liquefaction to power his panzers.

No, I checked the link first. Just double-checked.

I missed most of the day due to events at work. I see kermit couldn't get a leg up today, volume was enormous, and yet somehow the put/call ratio is pushing lows? Looks like the 5-day MA is well below the 20-day, the 5-day is at lows not seen since October 2007 (and we know how that turned out!). Looks like we're toppy here...

$CPCE - SharpCharts Workbench : StockCharts.com

Meanwhile, a major lender goes T.U. with a plume of fraud-stink pouring out of all orifices, the guy running FNM and FRE leaves and the government decides to do bad-bank/good-bank (why not just bad-bank/bad-bank and cut to the chase?).

Oh, and it was the emerging data on consumer income, real-world job losses, PCE and residential investment that turned kermit into frog legs for elmo?

And now rents are falling so the price/rent ratio will stay elevated above historic norms unless price comes down further... but we expected that...

Did I miss anything truly important?

Make NASCAR really interesting...

All stock Clunkers only~

They still have demolition derbies, don't they?

Lessee, how can we make this interesting with no engine? Well, there's the daredevil motocyclist that (almost) jumps over a bunch of cars, but that's boring.

Anyone with better ideas?

sorry, WS. you actually had two excellent points in that post. with a nuclear baseload, we can make electric cars an environmentally and economically sensible option PLUS electrifying A LOT of rail. look, the french do it today. nuke energy to run their network of trains.

we have to GROW UP and get serious about energy in this country. we'll have to have starvation first, i'm afraid.

So the ROI on arts is nil. Kill 'em.

Yes. Judge Rakoff said fuck you SEC I won't sign off on your consent decree with BAC, the public needs a hearing.

@RockyR: "once the news providers charge for online content, they can SUE for copyright infringement if you repost. everything would have to be transcribed / transposed... stuff gets distorted in translation."

Actually, I think that when a few thousand bloggers turn to dissecting the actual corporate and government PR directly, there will be less distortion in translation. I mean, right now, who do you believe? CR, Ritholtz and the like, who show you the actual data in detail? Or CNBC who just quote the massaged-for-the-media "headline" number? Multiply that by millions. For every site that will try to charge for content, there will be plenty who won't.

as for dissecting annual reports... i'll try to stifle my laughter.

I didn't say that. I said press releases. You know, the 1-page things that the MSM chop into sound bites for you without actually questioning the content?

For annual reports, there is a separate market for due diligence, and the buyers will find the lowest-cost route to meet their needs. I don't think 95% of the MSM have the time to read them in any detail anyway. They just call the PR flack to get the official quotes and spin and call it a day.

Here's an example of what you get in the mainstream financial press.

The WSJ says the S&P 500 PE ratio is

ahem, 65.32

P/Es & Yields on Major Indexes - Markets Data Center - WSJ.com

Barron's, owned by WSJ says it's 143.95

Barron's Market Lab Table - Barrons.com

S&P itself says it is 127.58 but they also said it was over 700 just the other day.

This is math folks. The financial press can't do math.

Check out how Iran suppressed their revolt by force of arms and news blackouts.

Jim, when the Revolutionary Guard showed up with their hand held weapons, no one there could oppose them.

Here . . . well, the story would probably end differently.

CR is definitely the best news source i regularly consult. he gets his information from SOMEWHERE, and not all of it comes from fedgov.

what makes private entities report anything resembling truth anymore in those 1-page press releases you act like i've never seen? it used to be that the free press scrutinized these reports for accuracy. anymore? i guess the bloggers can fill this void, if the ignoramus class wakes up to the fact that an anonymous blogger online with a name like calculatedrisk is being more truthful with them than that lying katie couric.

g'nite. for real

The judge was not impressed with the $33 million BAC offered with a promise not to do it again. A trillion is a million million, thought the obviously deluded jurist.

yogi, I don't think the Judge was quite that explicit.

I think he said something like "tell you what, let's hold a hearing to get it all out in the open and then I'll approve it."

I've been in those chambers too, you know.

Can't. Let. Velocity. Decline. Further.

Pump pump pump.

Oh ya,

The WSJ calls the PE for the Russell 2000...

Ya'll ready for this?

"nil".

They stop reporting it when it goes negative. I don't know about you but I find the value of the negative number to be informative. For them to just stop reporting the number because it is a negative number is tarded.

picosec writes
The last few years used car sales have averaged about 41 million/year in the US citing what should be a reliable reference.
41 million a year? That's astounding. The turnover is that high?

"You can't teach the old maestro a new tune."

Jack Kerouac

Maybe I am missing something. To solve this paradox of thrift, the Fed is subsidizing car production? We want people with old cars, probably paid for, to buy new cars; which most likely will be bought on credit, 10,15,25k, or more, at a time when jobs are incomes are shrinking. If you have an old car, you can't afford a new car to begin with, especially on credit.

Good news America, STOP SAVING MONEY LIKE YOU ARE SUPPOSED TO, AND START RE-LEVERAGING UP, ON DEBT, JUST LIKE THE LAST 15 YEARS. Too much consumption and debt did not lead to this current mess. Do the right thing, and buy more shit you cannot afford or need.

CFC's should go to squatters.

Call it a push

It was my boss, to a landlord's lawyer who wouldn't take full rent to restore a tenant.

yogi, and that's what the gavel is for.

I didn't mean to suggest I hadn't heard the concept expressed in different terms.

sportsfan writes:
no one there could oppose them.
Here . . . well, the story would probably end differently.

Sorry, you are totally wrong. Demonstrations/unruly mobs are put down constantly in this country.
Sorry to burst your bubble.

Actually, I was holding the conference, and my boss said to me "Tell him to go fuck himself". I went in and said "The Judge feels strongly that you should accept the settlement..."

He signed the stip, and we came out to have the Judge "so order" it. The Judge asked me in front of the whole courtroom, "Did you tell him to go fuck himself?" -"I told him to tell you to go fuck yourself".

I was hysterical for half an hour.

I don't know about others but the C4C deal we did was win-win all around. An 18 year old Toyota Previa with 230K miles on it and probably getting 15/16 MPG was falling apart around my 19 year old son who inherited it. It qualified for $4500 and we took it down to the local Honda dealership and got him a Fit for $11000. Mom and Dad kick in $3000 and he's got his first taste of being a debt slave with a $8000 savings-backed loan at 3% from the credit union. $157 payments for 5 years. Even he can afford that on the tips he makes from the Country Club snack shack he works at while going to school. He's got new wheels that damn well could last him until he has a family he needs to worry about, he also gets to improve his credit score with a low interest loan backed by money he and we have saved, the dealership gets stimulated, and the air is a little cleaner.

Sounds like a good deal all around to me! Maybe others are screwing themselves or the country or whatever but our situation was ideal and I've made sure I remained debt free until just such an opportunity presented itself. I'm happy.

I think the Judge felt the lawyer knew the landlord had to restore, but was wasting time milking his client for fees.

So, I'm trying to generate a new sort of "socially responsible" investment list. Not the usual kind of social responsibility, though. I want to explicitly avoid subsidizing, sponsoring, or lending to the sort of reprehensible, irresponsible, morally-corrupt institutions whose horrific behavior has brought the global economy to its knees. I don't necessarily want to invest in everything that's clean, but I figure I can clear out at least 2/3 of the Russell 3000 and most of the bond market, and find some good pickings in what's left, eventually.

Thus, I figure:

1) No tarped bank stocks or CDs or bonds. ("don't reward the fraudsters and bank robbers")
... I'd extend this to anyone who's got crud stashed in the Federal Reserve, but they haven't released that list, have they?

2) No Treasuries ("don't subsidize the squandering")

3) No corporate sponsors of mainstream media shills (sorry, G.E., you were already excluded at step one.)

4) Probably no homebuilders.

5) No bailed-out auto companies. (But someday it'll be time to buy a 1000 F, maybe!)

6) No REITs.

Now, I can't do this perfectly with the investment options in my 401k's, so I'll have to make some compromises. But anyone else thinking along these lines? What else would you exclude?

sportsfan - the thing is, they haven't. So they won't.
Probably a good thing.
Any who tried, aren't around to tell about it.

My chariot is rolling quickly towards 200k miles... is a bit long in the tooth, with a windshield crack and moderate meaningless body damage, and even though i've learned to live it with it's quirks. i'd never sell it to a friend.

It's good cover though...

Governments buying cars for broke consumers with borrowed money that can't be paid back because the tax revenues to pay it off come from the broke consumer.

Giving people things when they have not developed the ability to produce the real wealth to fairly compensate the producers of these things not only causes the producers to stop producing (because they recieve less than they put in), but it also reduces the incentive for consumers to advance their own economic productivity, financially savvy, and political clout to bring them in parity with producers, financiers and politicians.

Like the housing bubble stimulus, "Cash for Clunkers" dumbs down the American population who no longer gains the wisdom that comes with self-made decisions and the often painful consequences. It insulates them from the real workings of finance, and robs them of that learning experience. And it destroys the incentive for self-improvement.

The housing bubble also did all these things; hence the damage already done to the American people and the economy.

Giving people things they can't afford based on the premise that they can afford to pay the debt to buy this things is a foundation built on lies, delusion, and severe mental defeciency.

We are robbing our people of their most valuable experience, wisdom, and character.

We are making them poor by taking responsibility for the awareness, conviction, action, terrible hardships, and wonderful successes that cultivate the human spirit and elevate the culture of humanity over the course of lifetimes and generations.

Cash for Clunkers, like all these other bailouts, handouts, immoral bubbles and inflations turn us into mindless housepets.

As we are systematically cut off from the information and decision making processes most relevent in this world, we simply become irrelevant.

"Agreed, it's just demand pulled forward (and debt multiplied). Same thing as when McTeer urged everyone to buy SUVs. "

Not the same thing at all. Our car was on its way out - it was literally falling apart around the Toyota engine which was still running great after 18 years. This program got us to go out and buy something we were going to need in maybe a year. Big deal. Opportunity knocked and we answered. The terms of the sale made it such that I'll bet most of the people that qualified were in our shoes. We were going to be buying something anyway and this was a great excuse to pull the trigger.

Millenia Nova - I'm Dead

'night all.

"How about the Honda's and the Prius's, anybody know?"

Don't know about newer Priuses but when I bought mine in '05 they were all made in Japan. The Honda Fit we just bought was also made in Japan.

ItsJustMe,

It IS the same thing, and you just proved it by saying "This program got us to go out and buy something we were going to need in maybe a year." It pulled your demand forward by a year.

I'm considering pulling the trigger on C4C, but it's gonna be a lot tougher to do the pre-emptive strike-hitting up panhandlers for money before they can ask me, when I get out of my new car...

IF I were in the market to buy another car, I wouldn't. The whole concept of the C4C program sickens me. To hear people here justify the use of it for ANY reason sickens me even more.

It pulled your demand forward by a year.

What is a stimulus supposed to do? Is it supposed to create demand where none existed? I don't think so.

I drive a 1994 Lexus SC-400. As with ItsJustMe's Toyota, the entire care will disintegrate before the engine stops performing. It's a fabulous engine. I have over 200,000 miles on it and it just flat out performs.

Did I consider C4C? Of course not. Why would I when my current car does what I need it to do? Hence there is no demand in my household (to be pulled forward or not).

Give me a $10,000 credit and I might make a deal because that's more than my car is worth. The problem, of course, is that doing so would be creating artificial demand. That would also be stimulative, but of lesser value to the overall economy in the long term.

I like C4C. It beats the hell out of giving more money to the banksters.

So bearly, barley, and barfly really are different bots...

Jas may have been part bot, but the adult autism theory works as well.

So one of the hard parts of the new "Fiscally Responsible Investment List" is figuring out what to do with the cash/short term assets. There are plenty of good hardworking corporations in which to invest the equity segment of the portfolio, and similar for the bond portfolio (maybe with a few "healthy bank" CDs to cut the risk level and purchase costs down). But cash is tricky.

Most of the money market funds are up to their eyeballs in Treasuries, Fannie/Freddie, or Tarp'ed bank paper. So, minimize those. At the moment we're propping up our local Credit Union (though even the NCUA and the corporate credit unions drank the cool-aid), because at least the lending is (mostly) local. Next option is to set up our own mini-money-market fund with short-term corporate bonds from the "responsible corporations" list, but that has steep transaction costs unless we put a lot of money in there and avoid taking it out quickly. And even then it requires a lot of maintenance. Hmm...

@Ran - agreed about war profiteers. Halliburton is out for sure; who else would make your "profiteers" list?

P.S. One of my issues with C4C is that the used-car segment of the economy might be almost as fraudulent as the banks. All the stories of hurricane-damaged cars being sold out-of-state as "good vehicles" turned my stomach... [Edit: and thus, I don't trust that they'll actually destroy the engines, nor that they won't "recycle" the same vehicles through the program a few times... if I once trusted the government to control against that sort of fraud, I lost all illusions with the TARP and related shenanigans this past year.]

"It pulled your demand forward by a year. "

Mice nuts. We'd been driving the thing for 18 years for chrissake. We could have justified buying a new car a year ago but we're too cheap!

Whatever news I didn't get from CR today, I will get from Jon Stewart now.

Steven Colbert is truly talented in his portrayal of a conservative hatemonger.

If only I could stay awake that long. Goodnight folks.

Hey, if they're going to put it out there I have no problem with the fiscally prudent taking advantage of it, even if the program itself is BS.

"At the moment we're propping up our local Credit Union "

That is perfectly acceptable I think. Most of the CUs I have dealt with both personally and professionally are good people, and are well meaning - they really do want to give good loans to deserving borrowers, and practice the "know your borrower" principal.

ItsJustMe,

"Mice Nuts"? ROFL!!!

You can't deny what you said. You said you would've had to replace within a year or so, and C4C was an opportunity to do it earlier. That's the very definition of pulling demand forward.

You're smart to take advantage of the opportunity, though, because personally it made economic sense.

Macroeconomically, not so much.

gabyjan,

It would probably be easier to count those who are not.

Well, Nova and Pavel are in love.

I don't judge Otis and Broward, but those leather pants were a little off-putting.

@TJ and ghostface "You're welcome for taking my tax money." and " if they're going to put it out there I have no problem with the fiscally prudent taking advantage of it,"

Also, a smaller government would have much less opportunity and ability to corrupt the population with handouts. I'm going to be anti-tax for decades after what happened in the past year.

You're welcome for taking my tax money.

Do you walk up to soldiers and say this, too?

That is good and thanks for the info Binko! How about the Honda's and the Prius's, anybody know? I will not be surprised if 40% of the stimulus goes out of our economy, no matter what. The Japanese automakers make billions from selling autos in the US, and these are the most popular cars, mostly Japanese. So it follows the much of that money will find its way into the Japanese economy.

Toyota actually built a factory in Mississipi that was intended to build the Prius. But Americans are fickle about fuel efficient cars. When the price of gas dropped last year people stopped buying so many Priuses. Now the factory is sitting imcomplete waiting for demand to pick back up.

As far as who I'd like the profits to accrue to, I'd much prefer Toyota to GM. Toyota has a long history of treating their workers fairly, planning for the long run, and doing everything in their power to avoid layoffs. Meanwhile GM is a failed company that richly deserved to die. It lives on now in Zombie form only because the Feds are an owner.

Profits that go to Toyota will be used to strengthen the company for the future while profits that go to GM will be pissed away down a bottomless rathole of incompetence.

The "my tax money" stuff is a little off base.
Chinese bond buyers are financing our taste for Japanese cars. Taxpayers, not so much.

"At the moment we're propping up our local Credit Union "

The local CU is fine, upstanding people. But the corporate credit unions did all the bad things that the bad banks did, and I think the NCUA got caught with its pants down by its auditors in terms of trying to self-capitalize (see their press release from last Friday: http://www.ncua.gov/news/press_releases/2009/7-31NCUAAnnouncesChangestoCLFInvestmentPolicy.pdf  and associated discussion here on the afternoon/evening threads...). So the local CUs are going to have to pay up to recapitalize the whole mess. Not so good.

For our local CU, I'm waiting for the June financials to come out so I can digest their current exposure to the slime at the top.

About the tax money -- last time I checked, our soldiers were mostly messing around with other countries. Protecting our own borders? Not really. Protecting the oil supply so we can send China's money over to Saudi Arabia? Definitely. Would we be better off taking $100 billion/year out of the defense budget (and would they really notice?), and using it to deploy new energy technologies so we didn't need the middle eastern oil? I think so. Would we be hounded by terrorists if we weren't subsidizing hideous governments in the middle east? I suspect not so much. Plenty of local targets... But I'm getting late-night political with sleep deprivation, so I toss in a trillion grains of salt for you to take all this with...

Toyota has a long history of treating their workers fairly ... Meanwhile GM is a failed company

Rumor has it that not just Toyota, but GM also paid their workers pretty good, took care of their healthcare...
Unclear that Toyota was better to their workers ???

Don't count your yen until they've finished printing your pension.

nytnow

a 0%-tax-rate government buys no security or protection
In theory, people could protect themselves in volunteer groups.
.
ah, it's late. A favorite quote:
"In theory, there is no difference between theory and practice. In practice, there is."

squidware
that's from Yogi Berra

I don't judge Otis and Broward, but those leather pants were a little off-putting.

Sorry, busy with sex and pricing a replacement car.
GEICO gave me about 10% more than I expected for my totaled Echo.
But I have no trade-in that qualifies for the C4C program.
.
.
I'm debating between a 2005-2007 Miata, Civic, Fit, Corolla, Focus.
If I was sure that I'd have a real job again, I'd get the Miata.
But I'm about 50/50, based on what all I've seen in the past year.

Have some friends who had to replace a five-year-old Focus - sudden deterioration - though they liked the car and took good care of it. But then LLiz really loves hers. Consumer Reports is your friend?

YLSP
from my own creative production how great or meager that might be the one thing I take away
is that creativity is not like work, can't schedule it... I never know when inspiration might hit. yes,
it's important to create a routine, hopefully on a daily basis, but that in itself doesn't promise
anything. I am a proponent of the Roger Penrose school on why a machine can't model the
human brain in say the concept of aesthetics. Penrose believes the brain processes information
at a capacity along the lines of a quantum
computer. about a dozen years ago I talked briefly with Oliver Sacks about this and he just
blew off Sir Roger like he was some belligerent drunk in a bar. What a pompous ass is
Oliver Sacks!
....

must be the beer talking cause I just looked Who's Online
and I thought it said 6 Losers!
....
but then again after a cursory review of the list maybe there's
something to be said about 1st impressions?
.....
see a lot of old names returning, wonder what ever happened to Popeye
(snarling) "if you don't take your profits somebody else will" (tm)
.....
I keep buying these pirate dvd's and they keep breaking near the end of
the 3rd act in a 5 act structure... last 2 movies were The International and then
Duplicity (in a way really the same movie), did get a kick out of walking the
Khmer Rouged One thru the various guns displayed and asking if Pappaw
had the same... yes to Uzzis, but said he had much bigger guns and smaller
guns plus various launchers - we are talking about a guy's house here not a
military base... he is the last of the Hard Men, his problem is trying to teach his
kids the fervor of a True Believer

...................hey , Duke of Con .......you quoted wrong way......here is the right one ........"take your profits before other people take yours.".......if this fella followed my advice , now he owns private jet or someting ........poor thing.......

...........here is the list 'popeye' used quoted.......

November 1929 - April 1930: +48%

June 1930 - September 1930: +12%

December 1930 - February 1931: +21%

May 1931 - June 1931: +27%

October 1932 - November 1931: +35%

July 1932 - September 1932: +72%

.................I memorized list .......am I right 'popeye' or 'dum luk' ?..........

I wouldn't count on any fuel savings. My guess is that the new vehicles are going to be driven more often and further than
the clunkers . Who wants to take a Sunday drive in a 1970's rust bucket, or trusts it to go to the next town ?

good morning
homegnome you are so good to us. bff poll up already.

squidward (profile) wrote (in reply to...) on Thu, 8/6/2009 - 2:18 am

Rumor has it that not just Toyota, but GM also paid their workers pretty good, took care of their healthcare...
Unclear that Toyota was better to their workers ???

Toyota WAS (and most likely still is) good to their workers. Their subcontractors? Not so much-
Edit; I was talking about Japanese workers...

OT: I found the passage below in my homeowner's ins. policy provided by Travelers. Anybody know anything about Marshall & Swift/Boeckh? I believe deflation is a bigger risk than inflation, at least for the next year, and don't plan to increase my coverage, but I certainly appreciate Travelers' efforts to help me

Coverage for your home has been increased by 5.5% to more adequately reflect the cost to rebuild your home. This adjustment was based on information provided by Marshall & Swift/Boeckh, an independent firm specializing in construction and consumer costs.

OT:
According to 5 U.S.C. § 552a, United States agencies, including the Executive Office of the President shall, “maintain no record describing how any individual exercises rights guaranteed by the First Amendment unless expressly authorized by statute or by the individual about whom the record is maintained or unless pertinent to and within the scope of an authorized law enforcement activity.”

How does this impact yesterday's White House remarks:
"There is a lot of disinformation about health insurance reform out there, spanning from control of personal finances to end of life care. These rumors often travel just below the surface via chain emails or through casual conversation. Since we can’t keep track of all of them here at the White House, we’re asking for your help. If you get an email or see something on the web about health insurance reform that seems fishy, send it to flag@whitehouse.gov."

Some of us are of a libertarian bent, and feel free speech is important. Without it, we probably would be able to enjoy CR.

I was shocked not to see this discussed:

Why do you hate America so much?

It would seem something big is coming down the pipe, as in a big failure somewhere, the AIG pump is covering something big...I can smell it.

Why do you hate America so much?

I love America, it's the dumb asses I can not stand.

shill
oh yes i agree, love this country but its people....!

shill (profile) wrote on Thu, 8/6/2009 - 8:36 am

I love America, it's the dumb asses I can not stand.

Shill,
Thanks for helping with the clarification.....

gabyjan (profile) wrote on Thu, 8/6/2009 - 8:38 am

shill
oh yes i agree, love this country but its people....!
The people are the country- the rest is nature

Duke of Con Dao (profile) wrote on Thu, 8/6/2009 - 8:35 am

Cinco -X
they may treat their Japanese workers quite well but you can't make a case that American workers are treated as
well as Detroit workers
Their American workers will most likely have jobs in the future. A less likely scenario for Detroit auto workers.

curious (profile) wrote on Thu, 8/6/2009 - 8:46 am

Is this surprising to anyone? I know that weekly reports of initial claims are noisy, but what about continuing claims? Are those data equally noisy?

Are you really asking us if we're dropping people off the ends of the rolls as fast as we're adding them?
Where's that stupid ?

Weekly Unemployment Claims Fall to 550 Thousand

picosec, nice analysis except for one part.

You used 250,000 vehicles in your analysis. This seems to assumes that without the C4C program, zero of these cars would have been purchased.

I don't think that is valid. In the past, CR has posted data showing pent up demand for new car purchases. Plus, from the stories I heard, people delayed purchases and moved purchases forward to take advantage of C4C.

I think the better number to use would be the marginal increase in auto sales. I'm not sure what that number is, or how to determine it, but I think it is dramatically smaller.

I'm guessing this would change the ROI downward. Considerably.

But C4C isn't about ROI, it is about goosing the consumer confidence. (through debt, ha!)

Don't worry. They'll just print more paper money. Forgetting the fact that it's not really a stimulus program. It's more of a let's create more debt, buy, buy, buy, program. It's all about short term gains with long term pains. You know, kind of like what a drug addict does. It's why I'm not buying into it. My goal after seeing how things seem to be heading is to get out of all my debt asap and into some real wealth securing assets. Hint. The dollar isn't one. China knows it and that's why Geithner said we are going to have to "tighten our belts" from here on out when the didn't agree to increase their buying of our debt. Probably another reason why China keeps trying to hoard gold which according to the real time tracking widget ExactPrice is sitting at $958.50 right now.