US Auto Sales May Hit 28-Year Low as Discounts Flop

See also:

US: Record 1 in 6 Americans in Government Anti-Poverty Programs


Aug. 31 (Bloomberg) — U.S. auto sales in August probably were the slowest for the month in 28 years as model-year closeout deals failed to entice consumers concerned the economy is worsening and they may lose their jobs.

Industrywide deliveries, to be released tomorrow, may have reached an annualized rate of 11.6 million vehicles this month, the average of eight analysts’ estimates compiled by Bloomberg. That would be the slowest August since 1982, according to researcher Ward’s AutoInfoBank. The rate would be 18 percent below last year’s 14.2 million pace, when the U.S. government’s “cash for clunkers” incentive program boosted sales.

“Home sales are way down, the stock market is way down, the unemployment report is very disappointing and consumer confidence is sputtering,” Jesse Toprak, vice president of industry trends at TrueCar.com, said in an interview. “People just don’t want to make big-ticket purchases because they’re uncertain about their jobs and the value of their homes.”

While automakers increased discounts by 1 percent from July to an average of $2,864 per vehicle, sales to individuals probably fell 7 percent from last month, according to Santa Monica, California-based TrueCar.

Read moreUS Auto Sales May Hit 28-Year Low as Discounts Flop

Lindsey Williams on The Alex Jones Show: Economic Warfare Declared on the US

Lindsey Williams on Alex Jones: ‘The Elite have changed there Timeline’ – ‘Within two years you will not recognize America’ – ‘War is planned after two years, starting in the middle east area and spreading to the entire world’

Alex continues his discussion with pastor Lindsey Williams about the plans of the elite to crash the economy.

Added: 23rd Oct 09

1 of 4:

Read moreLindsey Williams on The Alex Jones Show: Economic Warfare Declared on the US

Peter Schiff on RT: Americans must prepare for deepening unemployment, inflation

“Nobody in the senate today understands basic economics.”


Date: 17th Sep 09

Related information:

US: Hyperinflation Nation
Peter Schiff: The Case For Inflation (09/12/2009)

US: Hyperinflation Nation

Hyperinflation Nation starring Peter Schiff, Ron Paul, Jim Rogers, Marc Faber, Tom Woods, Gerald Celente, and others.

Prepare now before the US dollar is worthless.

Part 1 :

Read moreUS: Hyperinflation Nation

Official: US government will pull out of GM if no deal by July 10

general-motors1
A sign hangs in the window of a General Motors dealership in Chicago

The US government will pull its support from General Motors if the automaker does not get court permission for a speedy exit from bankruptcy protection by July 10, an official testified on Wednesday.

“We cannot make an open-ended commitment,” Henry Wilson, a member of President Barack Obama’s automotive task force, told the New York court.

GM is seeking court permission to sell its best assets to a new company in which the US government will get a majority stake.

Should the plan be approved in time, Wilson said the government could begin to sell its stake as early as 2010, once the new company is ready to launch a public stock offering.

Officials have said the Obama administration has no intention of nationalizing General Motors over the long term and will not be participating in its day-to-day operations.

Read moreOfficial: US government will pull out of GM if no deal by July 10

General Motors to file for bankruptcy

gm-headquarters

General Motors, once the largest company in the world, is expected to file for bankruptcy in a New York court tomorrow. Executives and politicians on both sides of the Atlantic are spending the weekend finalising details ahead of the historic capitulation that comes after months of talks and billions of dollars of government investment.

The filing will come on the heels of an eleventh-hour deal this weekend under which Magna International, the Canadian motor-parts group, agreed to rescue its European operations, which include two British plants employing 5,500 workers.

Read moreGeneral Motors to file for bankruptcy

We Will All Be Driving Obamamobiles

With control of GM and Chrysler the government is getting its wish. It is reaching its goal of over the last 30 years, to be able to force Americans to drive what it says they may drive.

In 1976 it began in force. An auto industry already with quality struggles and difficulty meeting the emissions and safety regulations got hit with Corporate Average Fuel Economy standards. In other nations the tax code was used to encourage people to buy smaller vehicles that used less gasoline, but that was not good enough for the rulers of the United States of America, they wanted vehicles that did not meet their fuel economy standards to simply go away.


GM bankruptcy plan eyes quick sale to government (Reuters):
NEW YORK, May 19 (Reuters) – If General Motors Corp (GM.N) files for bankruptcy, as widely expected, its healthy assets will be quickly sold to a new company owned by the U.S. government, a source familiar with the situation said on Tuesday.

The source, who was not cleared to speak with the media and would not be identified, said the U.S. government would pay for the assets by assuming the automaker’s $6 billion of secured debt and forgiving the bulk of the $15.4 billion of emergency loans that the U.S. Treasury has provided to GM.


While in Europe, large vehicles can still exist; the buyers simply have a huge tax bill. This is not a good arrangement, but it at least allows automakers to decide what they will build and control the mix of their vehicle lineup. CAFE is different. Should an automaker’s lineup not produce the result that the government has mandated, they are penalized across their entire lineup. That is they are taxed for every vehicle they sell. Even if the automaker meets these targets, a vehicle that has a fuel economy that is too low requires the buyer to pay a gas-guzzler tax. This tax was impressive in 1976 dollars, $1000 to $7000. Thanks to inflation, it’s now usually less than the sales tax on the vehicles it applies to. (And since it’s considered part of the sales price of the vehicle, there is a tax on the tax.)

Read moreWe Will All Be Driving Obamamobiles

GM plans to export cars from China to the US

General Motors is planning to build cars in China and import them into the United States, a strategy that could trigger further job losses and union anger in the US.

gm
Reports in China claim GM will start shipping cars from Shanghai in 2011. Photo: AFP/Getty

A plan to shift a greater proportion of the struggling car-maker’s production overseas is still being negotiated with US politicians, who have already lent GM $15.4bn (£10.18bn) in order to keep it afloat and safeguard its 90,000 US workers.

However, a spokesman for GM in Shanghai said it was “only a matter of time” before vehicles made in China are imported into the company’s home market, in another blow to the US car industry.

Related article: GM Starts Notifying 1100 US Dealers to Be Closed (Bloomberg)

After losing $6bn in the first quarter, GM has slashed its global production by 40pc, or 900,000 vehicles. Around 13 assembly plants will be affected by shutdowns in the US. The company has a June 1 deadline to complete a restructuring or follow Chrysler into Chapter 11 bankruptcy.

Read moreGM plans to export cars from China to the US

GM shares fall to 76-yr low after execs dump stock

* Shares down 22 pct; 76-year low

* Vice chairman, 5 others sell almost $315,000 in stock

* Lose-lose situation for current shareholders-analyst

* Market capitalization drops to $690 mln (Adds analyst comments, background, bylines)

DETROIT, May 12 (Reuters) – General Motors Corp stock plunged more than 22 percent to a 76-year low on Tuesday, a day after a group of GM executives disclosed they had sold shares in the struggling automaker.

Six GM executives, led by former GM Vice Chairman and product chief Bob Lutz, disclosed on Monday that they sold almost $315,000 in stock and liquidated their remaining direct holdings in the automaker. [IDnN11125497]

The stock sale underscores the extreme pressure on GM with less than three weeks remaining for the embattled automaker to win deals to slash debt and operating costs with its major union and bondholders to avoid bankruptcy.

Read moreGM shares fall to 76-yr low after execs dump stock

GM to Cut 21,000 Jobs, Eliminate Pontiac


FILE–An undated file photo released by General Motors shows a 1968 Pontiac GTO. General Motors is expected to announce it’s restructuring plan Monday April 27, 2009, and it will include the discontinuation of the Pontiac brand, maker of the GTO _ one of America’s first muscle cars and so popular it inspired the Beach Boys to immortalize it in song. (AP Photo/General Motors, file) (Anonymous – AP)

The U.S. Treasury would own at least a 50 percent stake in General Motors under a plan the company released today to avoid bankruptcy.

The strategy would essentially formalize the government’s control over one of the icons of corporate America.

“I’m a believer in dealing in reality,” GM chief executive Fritz Henderson said in announcing the new plan. “We’ve gotten great support from the Treasury. It has viewed this matter from day one as a kind of private equity investment. It has pushed us in a lot of ways.”

Related articles: GM to shut plants for up to nine weeks this summer (AFP)

The announcement came as the company said it would further shrink the number of workers, dealers and types of cars in an attempt to prepare it for a United States shrunken by the recession.

Henderson said GM will eliminate 21,000 jobs by next year and phase out its Pontiac line as part of a last-ditch restructuring effort to keep the company afloat and win additional government aid.

Read moreGM to Cut 21,000 Jobs, Eliminate Pontiac

GM says it will go bust in days without new US bail-out

General Motors today warned it would go bust within 30 days unless the US treasury gives it a further multi-billion dollar loan.

The dramatic warning from America’s biggest car group came after its auditor, Deloitte, raised substantial doubts about its ability to continue operations as a going concern.

These alarm signals were contained in GM’s 480-page annual report for 2008 to the US Securities and Exchange Commission, America’s financial regulator. They further underline the parlous state of the global car industry.

Related article: GM Europe seeks cash with 300,000 jobs at risk (Times)

GM has so far received $13.4bn (£9.5bn) in treasury loans and a further $1.6bn in other government loans. Today , effectively holding a gun to the government’s head, it said it could default on this $15bn if it did not receive a further cash injection.

It is seeking a total of $30bn from the Obama administration after racking up $82bn of losses in the last three years, including $31bn last year.

The group, once the world’s biggest carmaker, said it needed $3.5bn cash in 2009 and a further $2.3bn to 2014 to stay alive. The plan it has submitted to Tim Geithner, the US treasury secretary, envisages 47,000 job losses – 26,000 outside the US.

Read moreGM says it will go bust in days without new US bail-out

GM Europe seeks cash with 300,000 jobs at risk

The carmaker wants £3billion from European governments to keep factories open, with Belgian and German plants most at risk

The European operations of General Motors will run out of cash within weeks unless they get government support, the American carmaker said yesterday, adding that a collapse would put up to 300,000 jobs at risk.

Fritz Henderson, the chief operating officer of GM, said that the division, which includes Opel in Germany and Vauxhall in Britain, would hit liquidity problems early in the second quarter.

Read moreGM Europe seeks cash with 300,000 jobs at risk

GM Posts $30.9 Billion Loss as Wagoner Seeks New Aid


Rick Wagoner, chairman and chief executive officer of General Motors Corp., pauses during a news conference at the company’s headquarters in Detroit, on Feb. 17, 2009. Photographer: Jeff Kowalsky/Bloomberg News

Feb. 26 (Bloomberg) — General Motors Corp. reported a $30.9 billion annual loss, the second-biggest in its 100-year history, as Chief Executive Officer Rick Wagoner asked the Treasury for more cash to survive through 2009.

GM’s cumulative deficit ballooned to $82 billion since the end of 2004, when the biggest U.S. automaker last had an annual profit. Full-year sales fell 17 percent to $149 billion, damped by a recession that ravaged new-car demand, GM said today.

“The size of the loss matters not only because it impacts what it will cost to restructure the company, but also the kind of bill for which the taxpayer is on the hook,” said John Casesa, a managing partner at consultant Casesa Shapiro Group LLC in New York.

Related articles:
GM’s Wagoner Meets With Auto Panel for Six Hours (Bloomberg)
Will GM bonds become worthless? (CNN Money)

The future of Detroit-based GM may pivot on whether Wagoner, 56, is able to persuade President Barack Obama’s auto task force to approve as much as $16.6 billion in additional money on top of $13.4 billion in loans so far. Wagoner is meeting with the panel today in Washington.

Should the panel decide against extending more aid, GM’s only option may be a government-backed bankruptcy, because the company said Feb. 17 it would run out of cash without at least $2 billion more in loans next month.

Read moreGM Posts $30.9 Billion Loss as Wagoner Seeks New Aid

GM, Chrysler Push for More U.S. Aid After Mistakes

Zombie banks, zombie carmakers, zombie debt and soon a zombie dollar……



Flags fly above a Chrysler sign outside their Detroit Axle facility in Detroit, Dec. 19, 2008. Photographer: Jeff Kowalsky/Bloomberg News

Feb. 17 (Bloomberg) — General Motors Corp. and Chrysler LLC, already relying on government aid to survive, take their case to the U.S. Treasury today that they can undo past mistakes and justify more U.S. aid to return to profit.

GM, with a pledge for $13.4 billion in loans, may seek support beyond an $18 billion request made Dec. 2 because of worsening economic conditions, people familiar with the automaker’s plan said. Chrysler has said it needs at least $3 billion in addition to $4 billion it received last month.

Read moreGM, Chrysler Push for More U.S. Aid After Mistakes

GM Trimming 10,000 Jobs, Reducing Pay as Much as 10%

Feb. 10 (Bloomberg) — General Motors Corp., the largest U.S. automaker, will cut 10,000 salaried jobs globally and reduce pay by as much as 10 percent to slash costs and prove its viability to keep $13.4 billion in government loans.

About 3,400 of GM’s 29,500 U.S. salaried workers will be dismissed by May 1, the Detroit-based automaker said in a statement. U.S. salaries will be cut temporarily by 10 percent for executives and by 3 percent to 7 percent for most others. GM Chief Executive Rick Wagoner, who already sliced his annual salary to $1, is reviewing salaries and benefits abroad.

Read moreGM Trimming 10,000 Jobs, Reducing Pay as Much as 10%

Caterpillar, Sprint, Pfizer slash at least 72,500 jobs


Paul King, mine manager, inspects a Caterpillar Inc. haul truck at the Australian Bulk Minerals iron ore mine at Savage River in Tasmania, Australia, on Nov. 6, 2008. Photographer: Carla Gottgens/Bloomberg News

Jan. 26 (Bloomberg) — Caterpillar Inc., Sprint Nextel Corp. and Home Depot Inc. led companies today announcing at least 72,500 job cuts as sales withered and construction slowed amid a global economic recession that may persist through 2009.

The biggest layoffs were at Peoria, Illinois-based Caterpillar. The world’s largest maker of construction equipment said it’s cutting 20,000 jobs after fourth-quarter profit fell by almost a third.

Pfizer Inc., the New York-based drugmaker that’s acquiring competitor Wyeth for $68 billion, said it will close five factories and eliminate 19,000 jobs, or 15 percent, of the combined company’s workforce.

The firings came as American jobless claims hit a 26-year high, reaching 589,000 in the week ended Jan. 17, as shrinking demand for products and services forced companies to lower costs.

Read moreCaterpillar, Sprint, Pfizer slash at least 72,500 jobs

Global Economic Crisis Accelerating

Obama administration considers launch of ‘bad bank’ (Telegraph)

US Initial Jobless Claims Match Highest Since ’82 (Bloomberg)

Barack Obama inauguration: this Emperor has no clothes, it will all end in tears (Telegraph)

Despite billions, banks still teeter on the brink (MSNBC)

Microsoft to shed 5,000 jobs (Financial Times)

Intel to Cut at Least 5000 Jobs (New York Times)

GM Gets $5.4 Billion Loan Installment From Federal Government (CNNMoney)

US jobless claims surge, housing start tumble (Forbes)

Housing Starts, Permits in US Slump to Record Low (Bloomberg)

Banks Foreclose on Builders With Perfect Records (New York Times)

Jim Rogers: Now it’s time to emigrate, says investment guru (Independent)

Saudi prince’s firm loses $8.3B in 4Q (AP)

Investors flee after brutal losses at global markets (Emirates Business)

Indians Flee Dubai as Dreams Crash – Fall out of Economic Crisis (Daijiworld):
It’s the great escape by Indians who’ve hit the dead-end in Dubai.

China growth slows, Bank of Japan sees deflation (Forbes):
(Reuters) – China’s economy slowed sharply in the fourth quarter and Japan’s central bank on Thursday predicted two years of deflation as Asia’s largest economies buckle under the strain of the financial crisis.

Roubini Sees China Recession Despite ‘Massaged’ GDP (Bloomberg)

Asian economic woe grows as China slows and Japanese exports plunge (Telegraph):
China’s economy may have ground to a halt entirely between the third and fourth quarters of last year and Japanese exports plunged 35pc in December, underlining the scale of the slowdown in Asia.

ZIMBABWE: Inflation at 6.5 quindecillion novemdecillion percent (IRIN)

Sony forecasts $2.9bn operating loss (Financial Times)

Hedge funds’ $400bn withdrawals hit (Financial Times)

Google income drops 68% on one-time charges (IHT)

Is Britain facing bankruptcy? (Guardian)

Manufacturing outlook plummets (Financial Times)

Car production plummets as pressure for industry bail-out grows (Telegraph)

London’s Evening Standard sold to ex-KGB agent (Reuters)

AIG starts $20bn auction of Asian unit (Financial Times):
AIG, the stricken insurance giant, on Wednesday kicked off the sale of its Asian life assurance unit – one of its most prized assets – in the hope of raising up to $20bn to help repay the $60bn US government loan that is keeping the group alive.

UBS to Cut Securities Jobs, Close More Debt Units (Bloomberg)

Japanese Housewives Desperate After Currency Scheme Collapses (Bloomberg)

New age of rebellion and riot stalks Europe (Times Online)

Increase in burglaries shows effect of recession (Guardian)

Chinese media issues stinging attack on Barack Obama and George W Bush (Telegraph)

Barclays may lose control to Gulf investors (Telegraph)

Cars to be crushed in insurance crackdown (Scotsman)

Investors say jailed pilot swiped money for years (Washington Post)

Capital One Reports $1.42 Billion Loss on Charges (Bloomberg)

Nokia reports sharp fall in profits (Financial Times)

Global Economic Crisis Accelerating

Jim Rogers: ‘UK has nothing to sell’ (Financial Times):
“The City of London is finished, the financial centre of the world is moving east.”

Jim Rogers: Obama administration run by people who caused the latest financial problems (BBC News)

The Obama Stimulus Plan Won’t Work (Lew Rockwell)

SERIOUSLY ALARMED (Telegraph):
(Even Mr. Ambrose Evans-Pritchard is now alarmed!)

King paves way to start Bank print presses (Times Online)

Sterling hits 23-year low against dollar (Financial Times)

Geithner pledges ‘dramatic’ action (Financial Times)

Portugal says S&P downgrade due to global crisis (Reuters)

Singapore Economy May Post Biggest Decline on Record (Bloomberg)

Emerging markets face $180 bn investment decline (Business Standard)

French government to pump €6bn into ailing car industry (Guardian)

Japan’s ‘Severe’ Recession May Last Three Years, Yoshikawa Says (Bloomberg)

BHP Billiton to cut 6000 jobs and close mine (Times Online)

Eaton to Cut 5200 Jobs in a 2nd Wave of Reductions (Bloomberg)

Record redundancies push unemployment to 1.92 million (Times Online)

Ecuador to Cut $1.5 Billion in Imports to Defend Use of Dollar (Bloomberg)

Ex-Scots bankers could face Holyrood inquiry (Times Online)

Ireland’s Banks Sink With Decline of ‘Celtic Tiger’ (Bloomberg)

Patrick Rocca, ‘poster boy’ of Ireland’s Celtic Tiger, kills himself (Times Online)

Bankers accused in crisis could face trials in US (Guardian)

Hedge Fund Run by Ex-Car Salesman Is Scam, SEC Says (Bloomberg)

Federal Home Loan Banks may have to borrow from US (Los Angeles Times)

Merrill Clients Pulled $10 Billion in Fourth Quarter (Bloomberg)

Standard Life investors demand compensation after ‘cash’ fund invests in toxic debt (Telegraph)

Toyota Tops GM in Global Car Sales in 2008 (Washington Post)

Citigroup Makes Stock Incentive Awards to Executives (Bloomberg)

General Motors and Chrysler to ask US for more funds

General Motors and Chrysler are to call upon the US government for billions more in extra funding as President-elect Barack Obama asks the US Congress to release the second half of the $700bn (£471bn) bail-out fund.

Chrysler badge - General Motors and Chrysler to ask US for more funds
Chrysler, along with General Motors, has already received $17.4bn from the US government Photo: Getty

The two companies, who were granted $17.4bn from the US Treasury’s $700bn Troubled Assets Relief Programme (TARP) in December, are working to achieve further funds in order to carry out comprehensive restructurings of their ailing businesses.

GM chairman and chief executive Rick Wagoner said at the North American International Motor Show in Detroit that the $13.4bn his company should receive in full by mid-February will be enough to see it through to the end of March, but wouldn’t comment on what the next move might be.

But GM president Fritz Henderson stressed yesterday that the baseline plan submitted to Congress in December called for a total of $18bn under the worst-case scenario envisaged for the US auto industry.

“We’ll develop our plan … then we’ll present it. We’ll make judgments from there,” he said ahead of GM’s press conference at the motor show. “It was pretty clear that the requirements were beyond, at that point, $12bn for a continued downside scenario.”

Meanwhile Chrysler is already in talks with the Treasury over further funding, seeking $3bn in additional government aid for its finance arm, with sources suggesting a second cash infusion on top of the $4bn received in December could be complete by the end of this week. “We are making good progress to qualify for a total of $7bn, which puts us in a really good financial position,” Chrysler vice-chairman Jim Press said.

The cash calls from Detroit came as President-elect Obama asked President George W Bush to ask Congress to free-up the remaining $350bn of the TARP allocation.

Read moreGeneral Motors and Chrysler to ask US for more funds

GM’s 2008 U.S. Sales Dive to 49-Year Low

Jan. 5 (Bloomberg) — General Motors Corp.’s U.S. sales plunged to a 49-year low in 2008, dragged down by a 31 percent slide in December as demand was ravaged by the recession and concern that the biggest domestic automaker might collapse.

Toyota Motor Corp.’s U.S. deliveries plummeted 37 percent last month, while Honda Motor Co. slipped 35 percent, Ford Motor Co. fell 32 percent and Nissan Motor Co. was down 31 percent, pointing toward the industry’s worst annual volume since 1992. Chrysler LLC dived 53 percent.

Related articles:
Auto sales plunge again in December (CNN)
Bleak US sales in December cap a grim year for automaker (
IHT)
US Auto Sales Plunge Whopping 36 Percent in Dec. (AP)

The federal rescue of GM and Chrysler couldn’t overcome buyer pessimism and tight credit in the world’s biggest auto market. Ford’s 2008 U.S. sales sagged to a 47-year low, while GM’s total of 2.95 million light vehicles was the least since 1959, according to trade publication Automotive News.

“It’s one of the worst years ever, and this year will be worse,” said Stephanie Brinley, an analyst at consulting firm AutoPacific Inc. in Southfield, Michigan. “It’s not a gas problem. It’s not a credit problem. It’s a consumer confidence problem, and it’s worldwide.”

GM and Chrysler received commitments last month for as much as $17.4 billion in U.S. loans, saying they would have run short of operating cash by this month.

GM’s results last month beat the average estimate of a 41 percent drop among six analysts surveyed by Bloomberg News. Tempering the decline was a 43 percent surge in deliveries of the Chevrolet Malibu sedan. Sales of GM’s Saab brand, which the Detroit-based automaker says it may sell, fell 57 percent.

U.S. Market Share

Thanks to bigger declines throughout 2008, the U.S. automakers will likely mark the first calendar year where their combined market share was less than 50 percent, based on results through November, when they held 47 percent.

The drop in full-year U.S. sales for Toyota and Honda were the first for the Japanese automakers since 1995 and 1993, respectively.

Toyota failed to get a boost from no-interest loans offered on most of its models since Oct. 2. Sales of its Prius hybrid, the best-selling gasoline-electric car in the U.S., declined 45 percent. The Tundra full-size pickup dropped 52 percent, while Toyota’s Lexus luxury brand finished the month down 32 percent.

Industrywide Decline

Industrywide U.S. sales extended a streak of declines of at least 25 percent dating to September. Vehicle sales for the year likely will total slightly more than 13 million, based on estimates from a Bloomberg News survey of 22 analysts and economists.

While that annual total would be the lowest in 16 years, it doesn’t reflect the steepening slide in U.S. auto demand.

Last month’s seasonally adjusted annual sales rate probably was 10 million, a 39 percent decline, based on the Bloomberg survey. The November rate was 10.2 million, and annual sales for all of 2007 were 16.1 million.

“We are at the bottom now,” said Tom Libby, an automotive analyst at consumer-research firm J.D. Power & Associates in Troy, Michigan. “People have just stopped buying and I don’t blame them. When you have such a decline in savings and net worth, it just doesn’t surprise me sales have fallen so much.”

Sales of Daimler AG’s Mercedes-Benz and Smart minicar fell 24 percent in December. Volkswagen AG was down 14 percent, while its Audi unit was off 9.3 percent. Bayerische Motoren Werke AG’s sales of BMW- and Mini-brand autos fell 36 percent.

Weak Economy

U.S. jobless rolls reached a 26-year high in the week ended Dec. 20, signaling a worsening labor market as the economy heads into the second year of a recession. That weakness adds to the strain on automakers after record fuel prices in 2008’s first half damped demand for full-size pickups and sport-utility vehicles.

President-elect Barack Obama has made an economic stimulus package his top priority, and he told reporters today in Washington that the nation faces an “extraordinary challenge” in reviving growth.

“The sooner stimulus efforts find their way to where they’ll do the most good — into the hands of consumers — the sooner we’ll see a turnaround in confidence levels and a return of buyers to the marketplace,” Jim Lentz, president of Toyota’s U.S. sales unit, said in a statement today.

December’s plunge may have been eased by the resumption of low-cost financing from GM last week, auto-research firm Edmunds.com said, citing a surge in vehicle inquiries on its site and dealer surveys.

Ford’s U.S. sales were “strong” in the last two weeks of December, Executive Vice President Mark Fields told reporters today in Dearborn, Michigan, where the automaker is based. Ford discounted its remaining F-150 pickups from the 2008 model year after a redesigned version debuted in October.

GM, Chrysler Rescue

Consumer concern that Detroit-based GM and Auburn Hills, Michigan-based Chrysler would fail to get government aid and be forced into bankruptcy may have contributed to December’s slump, Patrick Archambault, a Goldman, Sachs & Co. analyst based in New York, said in a Dec. 28 research note.

President George W. Bush announced Dec. 19 that GM and Chrysler would get the emergency loans in exchange for restructuring their businesses. GM had said it might run out of operating funds by the end of 2008, while Chrysler had said it might fall short by the middle of this month.

GM had resisted demands by some U.S. lawmakers that it file for bankruptcy instead of pursuing federal loans, saying buyers wouldn’t trust a car company under court protection.

To contact the reporters on this story: Mike Ramsey in Southfield, Michigan, at [email protected]; Alan Ohnsman in Los Angeles at [email protected]

Last Updated: January 5, 2009 15:22 EST
By Mike Ramsey and Alan Ohnsman

Source: Bloomberg

Treasury to continue bailing out firms, industries by looting taxpayers’

It seems that the US government and the Federal Reserve are looting taxpayers’ until there is nothing left.

If you take into account what Peter Schiff and Lindsey Williams are telling us….

Peter Schiff: US Dollar is on the verge of collapse; This is hyperinflation; This is Zimbabwe (12/17/2008):
“I am a 100% convinced that anybody who has their wealth in US Dollars will be just as broke as the people who had their money with Madoff.”

Peter Schiff on CNBC: The government is pouring gasoline on a fire that it set (12/29/08):
“We are in the process of creating another Great Depression.”

Lindsey Williams: The Dollar And The US Will Collapse; Saudi Arabia And Dubai Will Fall; US Will Be Third World Country; The Greatest Depression Is Coming

…with the odd timing that there is an ‘Army combat unit to deploy within the U.S.’ plus ‘Pentagon: 20,000 Troops to Bolster Domestic Security’

((Of course those troops need training: Northcom Combat Team Conducts “Humanitarian Support” Exercise in Maryland: “The Armed Forces Press Service has initiated a propaganda campaign designed to convince the American people that deploying the 3rd Infantry Division in the United States in violation of the Posse Comitatus Act is a good thing.”))

…then it does not sound like a crazy conspiracy theory anymore that the government will deploy more and more soldiers within the U.S. in preparation for civil unrest in case US citizens realize that they are betrayed by the government and the Fed, who ‘are’ destroying the future of the US by creating massive debt and hyperinflation, which will ultimately lead to the total collapse of the US.

Soon the government and the Fed will have turned the U.S. into a ‘Third World’ country.


Source: Bloomberg

Treasury Opens Door to Aid for Broad Array of Firms, Industries

Jan. 1 (Bloomberg) — The U.S. Treasury threw the door open to taxpayer financing for a widening array of companies and industries by drafting broad guidelines on aid to the auto industry.

The Treasury’s guidelines, published yesterday, would let officials provide funds to any company they deem important to making or financing cars. That leaves room for the government to provide money from the Troubled Asset Relief Program beyond loans already committed to General Motors Corp., GMAC LLC and Chrysler LLC.

“There are going to be other industries that are going to have just as good a case,” as the auto companies, former St. Louis Federal Reserve Bank President William Poole said in an interview on Bloomberg Television. “We don’t know what those other industries are going to be. Where does this process stop?”

Shares of auto suppliers including American Axle & Manufacturing Holdings Inc. and Lear Corp. jumped yesterday after Treasury announced the guidelines. The Motor & Equipment Manufacturers Association has been lobbying for the use of federal funds as a backstop in case parts makers can’t collect money the auto manufacturers owe them.

Read moreTreasury to continue bailing out firms, industries by looting taxpayers’

GMAC Becomes a Bank as Fed Bolsters Plan to Save GM

“These guys should be in Chapter 11,” said Julian Mann, a mortgage- and asset-backed bond manager at First Pacific Advisors LLC in Los Angeles, referring to the U.S. bankruptcy code. Mann’s firm oversees $9 billion. “We’ve now gotten into the business of discouraging prudence and encouraging risky behavior and irresponsibility.”



A GMAC Real Estate sign, attached to a sign advertising 0% down financing, is posted in the front yard of a home in Norcross, Georgia, on Sept. 12, 2007. Photographer: Chris Rank/ Bloomberg News

Dec. 25 (Bloomberg) — GMAC LLC won Federal Reserve approval to become a bank holding company, a switch that may enable the money-losing auto and home lender to tap U.S. financial bailout programs and help keep General Motors Corp. in business.

The Fed used emergency powers yesterday to grant Detroit- based GMAC’s request, citing turmoil in financial markets and the potential impact on GM, the biggest U.S. automaker, which has warned it’s running out of cash. GM and Cerberus Capital Management LP, GMAC’s majority owner, will give up control of the lender to comply with federal rules on who can own banks.

Saving GMAC is a step toward salvaging GM, which received a temporary bailout earlier this month. The $9.4 billion loan will sustain GM at least until January, when President-elect Barack Obama must find a more permanent way to save millions of auto industry jobs and avoid deepening the year-old recession. Dealers and analysts say a GM rescue is more likely to work if GMAC is still around to make car loans, which the Fed’s action ensures.

Read moreGMAC Becomes a Bank as Fed Bolsters Plan to Save GM

GM Stock, Bond Investors Bet It Won’t Stay Afloat Even With U.S. Lifeline


Rick Wagoner, chief executive officer of General Motors Corp., speaks at a news conference at the company’s headquarters in Detroit, Dec. 19, 2008. Photographer: Jeff Kowalsky/Bloomberg News

Dec. 23 (Bloomberg) — General Motors Corp. Chief Executive Officer Rick Wagoner said the biggest U.S. automaker got “what we asked for” with $9.4 billion in U.S. loans over the next 24 days. Investors bet that it’s not enough.

Related: Stocks in U.S. Fall on Concern Loans Won’t Save Car Industry: GM Declines

GM dropped as much as 18 percent today in New York trading to extend yesterday’s 22 percent plunge, while credit-default swaps on GM bonds rose 0.5 percentage point in a sign of increasing concern that the Bush administration’s bailout may end in a default.

The stock-price slide erased the 23 percent gain on Dec. 19, when Detroit-based GM received a federal aid package to help the automaker stay in business until March 31 while it crafts a plan to shut plants, shed brands and reduce debt.

Read moreGM Stock, Bond Investors Bet It Won’t Stay Afloat Even With U.S. Lifeline

In Need of Cash, More Companies Cut 401(k) Match


FedEx and other pinched companies have cut their contributions to 401(k)’s, which could force some people to work longer. Joe Raedle/Getty Images

Companies eager to conserve cash are trimming their contributions to their workers’ 401(k) retirement plans, putting a new strain on America’s tattered safety net at the very moment when many workers are watching their accounts plummet along with the stock market.

When the FedEx Corporation slimmed down its pension plan last year, it softened the blow by offering workers enriched 401(k) contributions to make up for the pension benefits some would lose. But last week, with Americans sending fewer parcels and FedEx’s revenue growth at a standstill, the company said it would suspend all of its contributions for at least a year.

Read moreIn Need of Cash, More Companies Cut 401(k) Match