Thursday, December 18, 2008

US Manufacturing Crisis

That is, crises that are manufactured.

First, Wall Street provided proof of a credit crunch by...not lending. With absolutely no clue about how banks or Wall Street even works, congress was cowed into diverting $700 billion from other, worthier investments.

With that lesson in mind, Chrysler is manufacturing a crisis in Detroit by...not manufacturing. And, to prove that auto sales are down due to the non-existent credit crunch, Chrysler Financial is threatening...not to lend. And, to prove that dealers are having a rough go of things, Chrysler is going to start fining dealers for rolling stock left on the lot too long.

See how that works?

But, here's the deal. Michigan credit unions say they have plenty to lend on autos. There's no outcry from the UAW; Chrysler employees are getting an extra two weeks' paid vacation. And, by the way, if you've got too much inventory, curtailing production is the only sensible thing to do (which explains why it didn't happen sooner).

Chrysler is making all the right moves to extort $7 billion (just a downpayment to get them into January) in diverted funds from other, worthier investments. One of those other, worthier investments may just be loaning money to Chrysler at market terms. Ask yourself just how bad the market terms have to be to extort taxpayers while opening your company up to the dictates of the federal government.

Who says the US doesn't manufacture anymore?

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