Wednesday, August 19, 2009

Cash for Clunkers winding down, + the quote of the day (F)

AlphaNinja - The WSJ reports that Transportation secretary LaHood will update people on the results of the program.

"WASHINGTON—The Obama administration will release a plan this week to wind down its "cash for clunkers" incentive program, signaling that one of Washington's fastest-acting stimulus programs is nearing an end."

"Auto makers remain cautious about what will happen when the federal subsidies run out. In the past, and in other markets around the world, the end of such subsidies has led to another downturn in sales."

If you take money from one taxpayer and hand it to another toward the purchase of an Old Navy t-shirt, it's gonna have an effect. Just the same as if "cash for refrigerators" took money from one group and gave it to another to replace their appliance. Its just an example of the government picking winners and losers -->> in this case the winner (unsurprisingly) being one of the largest political donors (The United Auto Workers) around.

The quote of the day is technically from yesterday, but then again Monday's quote was from a dead guy.

I'm going to assume that Ford's "economist" is trying to be funny saying that:

"The percentage of people who say that "it is a good time to buy" a car is around 70%, which was the percentage seen before the credit crisis hit, according to her presentation."

Yes Ellen, I'd agree that borrowing money from China on behalf of the entire country in order to throw away perfectly useful cars and buy new ones, while morally (at least for a capitalist) reprehensible, is probably good for your business.

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