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Is America Doomed?

What is going to happen to America? It seems that the true meaning of capitalism is being destroyed. The problem is capitalism is being destroyed by the very people who say they’re trying to preserve it. How can this be? It’s how I see it. What are your thoughts? here’s mine.

First we started with the financial sector, now it’s the American auto industry. When are the taxpayers going to see the return on their investment in these sectors? At the rate it’s going, I doubt it will ever happen in our life time.

Yes, I know that the government is saying that this will help the economy, but aren’t they the same people who put us in this mess?

In the 1990’s NAFTA was signed and many business’ went over the border to make the products that were being built here in this country. Ford and General Motors have opened factories in Canada and Mexico since NAFTA was past.

When the bill was past in 1996 to help all American buy their own home. I’m sure the politicians were aware of the fact that it would be done with taxpayer’s money through Fannie Mae and Freddie Mac with the help of adjustable mortgage rates. It helped people get into homes that they couldn’t even afford.

Twenty plus years ago we heard that there was going to be more energy efficient cars within ten years. How come my 2005 truck gets the same mileage as the 1985 Grand Am I owned fifteen years ago? What’s with these CAFE laws and all the other regulations that are put on the automakers when the cars haven’t really improved over the decades.

Now after all this crap that has gone on for too long, the companies that are in trouble are going to the people who caused these problems for help. All the while the American people sit in their living rooms watching mindless TV and are none the wiser. Go figure.

I know that this isn’t a political site, but in all actuality this post isn’t about politics. It’s about the way Capitalism is being destroyed by people who have their own agenda. Wall Street and Main Street are one and the same and from where I live, it doesn’t look like capitalism to me.

We need to stop bailing out these companies that don’t handle their business in a proper manner. If you can’t make the business profitable then you shouldn’t be in business.

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Auto Bailout Heats Up

Again the CEO’s of the big three automakers are back in Washington to see if they can still get an auto bailout from Congress. General Motors, Ford and Chrysler are still looking for money to help keep them afloat.

What amazes me is that the three CEO’s think that if they drive down in hybrid cars (instead of their corporate jets like they did last time), that they are going to have any more of a chance to get the money to fuel their needs.

After going back to the drawing board, the companies came back to show what they’re going to do to improve the condition of the three giants. Of course it’s no longer $25 billion that will be needed to save them, this week it’s at $34 billion. Who knows where it will be when it’s all said and done.

As long as the UAW has a hold on the three companies, they will go out of business. The legacy costs are out of control. There are over 15,000 retirees that get paid $31 per hour from their pension plan for not doing anything for the company. The UAW has caused the costs of cars, truck and SUV’s to get out of control. It’s said that $2000 of of the price of every vehicle is due to legacy costs.
With obligations like that how are these companies ever going to turn a profit? There is no way for any company to be able to stay in business if the payroll cost are going up while the workforce is shrinking. How are they to keep their prices in line with their competition?

If you haven’t noticed, you don’t see any of the foreign automakers that build cars here in this country in Washington looking for a handout. It’s because the UAW has no existence in their factories and before you say that it’s not fair that those workers don’t have the right to have an union. They don’t want it, they make on average $35 per hour to work on an assembly line that the robots do most of the work. Before you say that $28-$42 per hour isn’t much for someone living in New York City, these workers are in Alabama and Tennessee, two of the poorest states in this country.

I have always bought American made cars because I believe in keeping my money in this country. It’s not that I’m against the rest of the world, it’s because I’m an American and proud of it. I will continue to buy American made cars as long as they are still American made cars. I know that no matter what happens to these three companies, there will always be cars made here in this country.
Even if the three of them were to go into bankruptcy and close their doors, someone else will buy their equipment and start to build a new automobile made here in America.

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Bankruptcy In America

In America, if a company can’t make a profit and loses money, they have one choice and that’s to file for bankruptcy.  Just because a company is big doesn’t mean that the government has to lend them taxpayer’s money to save it.
It’s amazing to see how the CEO’s of these big corporations have destroyed the company so much that they need the assistance of the U.S. government and the American taxpayer to save their skin. How can these men with such education be so stupid to take on the extreme risks that they did?
What I really want to know is how stupid is Congress to keep on bailing out these companies that shouldn’t even be allowed to operate as a business after losing that much capital. Using the excuse that they’re such big business’ within the United States is a lame one at that. Yes, many people will lose their jobs and the unemployment rate will jump into the double digits, but what other choice do we have? Do we keep giving them money until the Federal Reserve runs out of paper to print more? The airline industry went through bankruptcy years ago and they’re still in business (except for Eastern of course).
Do you really think that if the big three automakers go into bankruptcy that they (or we) won’t survive? We as American people have to not fall for the hype that the CEO’s, Congress and the mainstream media are trying to feed us. Look at all the money that’s was given to the financial industry and now it turns out it wasn’t used for what it was meant to be used for.
What about the banking system mess? These companies along with Congress have also done the wrong thing to the American people. If it wasn’t for Congress passing all those bills in the 1990’s that allowed the financial sector to lend money out in sub-prime mortgages, we wouldn’t be in this mess.
What has me really PO’d is that none of the people who are actually at fault, are being held accountable. Hank Paulson, Dick Fuld, Christopher Cox, Frank Dodd, Barney Frank and the President-elect are all to blame for the financial mess. Dick Wagoner, Alan Mulally and the UAW are to be blamed for the failure of the auto industry. I would like to blame Bob Nardelli from Chrysler too, but he just got there (I will blame him for the fall of The Home Depot).
Capitalism is what this country was built on, if we are to continue as a capitalistic country we need to let companies fall when they fail to make a profit.
When the decision was made to let Lehman Brothers filed bankruptcy, the company had no other choice but to restructure everything and sell of the assets that they had to clear their debt. If the American automakers are forced to do the same, they too will do what they have to to make the company survive. If they need to sell off assets, I’m sure that there’s an entrepreneur some where in this country that is willing to make profitable business out of the ashes. He could name the first model Phoenix.

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De-Leveraging The Stock Market

Tonight the Senate will have their turn to vote on the “invest In America” bill. Of course it’s a little different then the one that was voted on by Congress Monday. How is it different? I don’t know. The politicians need to vote on this issue, one way or another. With further investigation into this mess caused by over extended credit, I don’t know if it’s really wise to vote for the bill, but I will say that if they vote on it, it would be no one’s fault but our own for letting the country get out of control. It’s about time that this country de-leveraged all that has been extended.
The world can’t run without credit, but with everyone wanting to live the American dream of wanting their own home and drive nice cars, we lost sight of what’s really important. If you want to have nice things and live in a house that you own, you need to have the money to it. It’s not right that the people who have been responsible in their financial decisions and paid their bills should have to save the companies that took advantage of the system or even help the people who tried to live outside their means.
In the 1990’s the politicians sold the American people on the idea that it’s possible to get that dream. Then Congress (actually it was the Democrats) refused to put regulations in place to protect the economy from the problems we’re facing now. Add on top the people who didn’t have the financial intelligence to read the paperwork that they were signing nor did they care.
Now we’re at the point that we need to de-leverage the economy and pull back the reins on how business is done. The stock market is no different. The companies have done the same thing and as investor and traders we need to accept the fact that this will be done with or without the bailout plan. I hope that it won’t hit us as hard as they make it seem or as long that they predict.
We as a country have always come back and become stronger in the past and this won’t be any different.

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Security Exchange Commission (SEC) Under Investiga...

The Security Exchange Commission is under investigation for not doing their job. The investigation will be conducted by the Inspector General according to news reports. The SEC is at fault for missing red flags in regards to Bear Stearns as well as allowing them to use inside auditors which is clearly against the rules.
What I’m really surprised at is that it took this look to make the decision. Why is it though that the Inspector General hasn’t opened other investigation against Chris Cox and SEC for the lack of regulations that should have been done for the last three years?
In a statement from Chris Cox, He comment that he’s spoken before about the voluntary regulations rules are not the way things should be. What is he talking about? He’s the man in charge for making these regulations and he’s already stating that someone needs to do his job. It’s the job of the SEC to do these regulation investigation and to make sure that the guidelines are enforced.
This is one of the many reasons why this country’s economy and credit crisis is spiraling out of control. Accountability is something that is disappearing in this country’s government and it looks like it won’t be coming back anytime soon. This investigation is just a joke anyway because what are they going to do to the SEC? They can’t arrest the whole commission and there won’t be any fines that Chris Cox would have to pay. The worst thing that is to happen is the he will have to step down from his position as the Chairman. We all know what would happen then. he will be offered a position with one of the many financial institutions that he looked the other way for. It’s a shame that this corruption is going on right in front of our eyes and it seems that nothing can be done about it.

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