Financial Perils Of Ford, Gm Could Spark Recession

[tug_slug]

How could a recession affect not just U but the airline industry as whole?

Article

 

[PRINCESS KIDAGAKASH]

I won't be a recession. It will be a depression! A country can only amass so much national debt until it implodes. A country can only outsource so many high paying jobs until the wheels come off the economy. The stock market has ceased to be a tool for investment and has become nothing more than a get rich quick scheme. With the trade deficits that we have been running the last 30 years, I'm suprised there is any money left in the USA. Of course, the Chinese have been buying tons of government bonds that they almost control our economy and government anyway!

 

[Busdrvr]

I won't be a recession. It will be a depression! A country can only amass so much national debt until it implodes. A country can only outsource so many high paying jobs until the wheels come off the economy. The stock market has ceased to be a tool for investment and has become nothing more than a get rich quick scheme. With the trade deficits that we have been running the last 30 years, I'm suprised there is any money left in the USA. Of course, the Chinese have been buying tons of government bonds that they almost control our economy and government anyway!

[post="266368"][/post]​

LOL!!

How does todays debt load compare to the past? Debt servicing costs? Trade deficit for the last 30 years? cut that in half. It was near balanced during Bush1. When did it explode? When your 'labor friendly' boy clinton let Rubin tinker with exchange rates. why are the Chinese buying G-bonds? Because that's they only way they can prevent the yuan from appreciating, and if it did, you'd quit buying their cheap @ss stuff. Same for the Japanese meddling.

What's the government debt in Japan? Higher than ours as a percent of GDP. Deficit spending, again, higher.
What's the unemployment rate in Europe? Things are a lot better here than you think.

 

[jimntx]

LOL!!

. When did it explode? When your 'labor friendly' boy clinton let Rubin tinker with exchange rates.

[post="266380"][/post]​

I don't know whether to call this ignorance or outright lying. The U.S. Dollar has been allowed to float freely against the world's other currencies since 1984. Neither Clinton nor Rubin nor your hero, Shrub, has any control over or ability to manipulate foreign exchange rates.

The dollar is traded on world currency exchanges just like any other commodity, such as oil. The fact that it is devalued right now is due to exploding U.S. deficit spending by the government and massive sales of U.S. bonds to Korea and China done during Shrub's administration to finance the Halliburton Recovery Middle East War. During Clinton's administration there were government surplusses; so there was no need for deficit financing.

 

[libertybell]

The people who buy chinese goods or services are in a way buying the rope to hang themselves.

When you buy foriegn its just UN-American!


The house of cards folks is ready to collapse!

 

[delldude]

I won't be a recession. It will be a depression! A country can only amass so much national debt until it implodes. A country can only outsource so many high paying jobs until the wheels come off the economy. The stock market has ceased to be a tool for investment and has become nothing more than a get rich quick scheme. With the trade deficits that we have been running the last 30 years, I'm suprised there is any money left in the USA. Of course, the Chinese have been buying tons of government bonds that they almost control our economy and government anyway!

[post="266368"][/post]​

ITS GOING TO BE BECAUSE TWO OF THE BIGGEST WELFARE STATES ,GM AND FORD ARE ABOUT TO IMPLODE.....

 

[tug_slug]

ITS GOING TO BE BECAUSE TWO OF THE BIGGEST WELFARE STATES ,GM AND FORD ARE ABOUT TO IMPLODE.....

[post="266398"][/post]​

I think were getting a little of topic here.

Let me rephrase the question... how will a recession effect US Airways?

 

[delldude]

I think were getting a little of topic here.

Let me rephrase the question... how will a recession effect US Airways?

[post="266399"][/post]​

its too late,you can't change thread titles in mid stream.
gm and fords problems won't be the catalyst for recession...their internal problems come from previously negotiated contract obligations , seems i have seen this movie before.....it will cause some downsizing,possible attempts at concessions,but you know those autoworkers...they can be a fiesty bunch.
your main concern should be fuel prices and how they spin into every affected industry from airlines to food .....already people have chosen to drive when neccessary to save money......fuel pricing has spiked everything.....how was your 401k first qtr earnings???tell me it isn't already happening.
conserve money for gas so little elwood can go to soccer and we have no monies for leisure travel via airlines ....maybe disney next life.....
yes i know oil per barrel is coming down but hold your breath for gas much lowere than 2.00/gal

 

[speedbird86]

your main concern should be fuel prices and how they spin into every affected industry from airlines to food

[post="266453"][/post]​

I think you are right on the point. I've always thought fuel prices drive our economy more so than any other factor. When fuel is high, consumer spending is down. When fuel is low, or at least stable, consumer spending is up. Us spending our hard earned bucks is the key and I have less of it to spend because of my high fuel cost. So instead of buying those airlines tickets for that high power vacation this summer, I may instead go camping.

As for GM and Ford, it's been a long time coming. They have went right back to the gas guzzeling tanks of the sixties and seventies. Big, powerful, high horsepower V8's. My little Honda CRV will get from redlight to redlight just as fast as a Ford Expedition or a Chevy Suburban at less than half the cost. Sounds like Ford and GM are building a bunch of vehicles nobody wants. So instead of retooling to build cars that are affordable and efficient. They lose a few billion and bash labor.

As we all know, bad decisions come from the the top. But the worst of it is, the top keep getting richer and the rest have to figure out how to do more with less.

 

[Busdrvr]

I don't know whether to call this ignorance or outright lying. The U.S. Dollar has been allowed to float freely against the world's other currencies since 1984. Neither Clinton nor Rubin nor your hero, Shrub, has any control over or ability to manipulate foreign exchange rates.

The dollar is traded on world currency exchanges just like any other commodity, such as oil. The fact that it is devalued right now is due to exploding U.S. deficit spending by the government and massive sales of U.S. bonds to Korea and China done during Shrub's administration to finance the Halliburton Recovery Middle East War. During Clinton's administration there were government surplusses; so there was no need for deficit financing.

[post="266392"][/post]​

Ah, no jim. Rubin manipulated the currency markets HEAVILY through coordinated trades of the Yen and Mark (with the Fed and other central banks). It was part of his plan, poart of what he told congress he would do in his confirmation hearings. As a matter of fact, the ONLY administration that has NOT manipulated the currency markets since the collapse of the Bretton Woods system is the CURRENT one. Another little tidbit, all the other Republican Treasuries since Bretton Woods have led efforts to DEVALUE the currency, making imports MORE expensive, and exports cheaper (to make our manufacturing sector MORE competative). The only "anti-U.S. Manufacturing" administrtion was Clinton's starting in 1995.

Additionally your understanding of what causes "devalution" is rather weak. The dollars value surged during the first Reagan term when the deficit was growing rapidly. Japan's currency has risen strongly against the dollar in the last 4 years despite govt deficits that are approx double ours as a percent of GDP. The Euro has risen sharply despiute deficits in Germany and France approaching our level. I'd suggest you find a source for your economic theories that actually bases them on emperical data instead of recycled discredited theories.

 

[sentrido]

If they arent manipulating the currency, maybe they should?
Hey, Its just my opinion but the current crew have done a pretty bad job of running the economy. The large tax cuts combined with no restraint in spending havent worked, at least for the middle class. All the growth we have had hasnt gone to jobs or wages, just to profits. Who cares if GDP is up 3% this year? I havent had a raise in 3.

 

[Busdrvr]

If they arent manipulating the currency, maybe they should?
Hey, Its just my opinion but the current crew have done a pretty bad job of running the economy. The large tax cuts combined with no restraint in spending havent worked, at least for the middle class. All the growth we have had hasnt gone to jobs or wages, just to profits. Who cares if GDP is up 3% this year? I havent had a raise in 3.

[post="266541"][/post]​

Consider the set-up. The dollar was run up during the late 90's. Most of the excess (capital accounts surplus) was thrown into the stock market. This ran up stock prices for crap stocks like Enron. This also led to government revenues ballooning (as a percent of GDP)due to capital gains. Meanwhile, we became less and less competative, losing more and more manufacturing jobs.
It had to unravel, and it did. The treas allowed the dollar to fall slowly (a collapse would have been catastrophic). The government's revenue has fallen as capital gains became capital loses. As low as you think the dollar is, consider it was approx 80 yen to the dollar in 1995 vs approx 105 today.

There are tradeoffs, a weak currency means more exports, but less capital inflows, and a lower standard of living for the people with jobs.

 

[javaboy]

Back in the day the saying was what was good for GM was good for the Country.
during that time GM alone accounted for 4.8% of the GNP but today it accounts for .08% of GDP.

it is a huge company for sure. do you know what the biggest consumption GM is known for today?

Glass.....................no
steel......................no
electricity...............no
computers..............no
plastics..................no
fabric....................no
rubber...................no

presciption medicines...yes

pretty much sums it up no?



secondly following the auto industry for more years i care to remember..... the 0% financing and the like of the last few years "set them up" for a coming fall, on what is commonly known as non performaning commercial paper. people not paying on their GMAC card nor loans.

think about that, people can not afford a 0 or 1% loan. so they default. that is telling in and of itself about the economy.


what you or anyone else does with their money is their business, when congress must pass laws because of a perceived forthcoming bankrupcty crisis it becomes everyones problem. There is too much consumer debt now, much has been taken from equities in homes which have risen quickly in price, it is a scary thought if one were to become unable to pay on those loans causing loss of house, then attempting to sell a house that might not be able to cover the loan (possible bubble pop in Real estate in select markets) which would result in personal bankrupcties on the rise however unlike businesses, due to the recent change in the law even if you file BK you would still have to pay back what is owed (assuming requirements are met....trust me if you have a computer and are reading this you meet the requirements).

this is not just the airline or auto business either. this is collectively americans, floating too much debt period. ps america you are not saving enough either (not just 401ks but plain old cash in the bank) ok, whoaaa almost fell off the soap box....

sorry.. but finance is a sore point, a small amount of education in High School could go along way towards educating future consumers.

kirk out


B)

 

[delldude]

The dollar was run up during the late 90's. Most of the excess (capital accounts surplus) was thrown into the stock market. This ran up stock prices for crap stocks like Enron. This also led to government revenues ballooning (as a percent of GDP)due to capital gains. Meanwhile, we became less and less competative, losing more and more manufacturing jobs.

i'm having a hard time here....who was president when all this money was run up??i seem to forget.....

 

[WorldTraveler]

We may be better off than Europe and Japan but I certainly don't want to be like them.