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Should the US bail out US auto manufacturers?


Neo

Are you for a bail out of US auto manufacturers?  

39 members have voted

  1. 1. Are you for a bail out of US auto manufacturers?

    • Yes
      7
    • No
      26
    • Undecided
      6


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Before the credit freeze, other factors would come into play with someone who had 'fair' or even 'poor' credit. What type of loan are you looking for? Let's say the applicant had never missed any payments on a car or housing in the past. The stain on their credit may have been from a gym membership forgotten when they moved or maybe they got to heavy on credit cards and were late a few times. Heck they may have even had problems with a medical bill. People usually are going to work VERY hard to avoid missing payments or losing on their primary residence and their means of transport.

When you set the standard of lending based purely on credit score, as mentioned earlier, you block out the majority of consumers.

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While I agree the US auto manufacturing business should be saved, this is exactly the way it should not be done because it does not address any of the problems that got us in this trouble in the first place.

The US economy is tanking because there has been too much loose credit that has led to irresponsible and excessive spending. So the Bush-O-nomics way to fix this problem is to give $6B to a finance company so that people can be given more credit for more spending. There is an idiocy to this that even Hollywood would not put to a script. GMAC's business plan for recovery is to take government money and loan it to people who shouldn't be getting these loans in the first place. The beotch of it is, if GMAC can't pay this money back, it's investors, namely those at Cerebus, are not on the hook to pay any of it back. It's simply surreal.

The bailout does two things. It saves GMAC, a company that is nothing more than a finance company. More importantly it also save ~40% of the 6000 GM dealerships out there which is about 2,400 dealers. The owners of these dealerships overwhelmingly contribute to the GOP so I think you now know why they took this approach.

They should have taken this $6B and invested it in battery technology, clean diesel technology, or mass transit if they really wanted to do some good.

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So the Bush-O-nomics way to fix this problem is to give $6B to a finance company so that people can be given more credit for more spending. There is an idiocy to this that even Hollywood would not put to a script. GMAC's business plan for recovery is to take government money and loan it to people who shouldn't be getting these loans in the first place. The beotch of it is, if GMAC can't pay this money back, it's investors, namely those at Cerebus, are not on the hook to pay any of it back. It's simply surreal.
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^If you are offended then that is really your problem. You would really be offended by huge finance companies that have reduced your worth as a person to a 3 digit number and simply refuse to do business with them. Small community banks and credit unions don't use simple credit scores when determining whether to loan money to people. Not surprisingly they are also not in any trouble and are not asking for taxpayer bailouts.

My young niece bought a new Ford Focus this past week. She went to Bank of America, who despite getting $25B in bailout money, claimed they were not making car loans like this now. So she went to the local credit union who instead looked at her job, existing debt, etc and gladly made her the loan. So she is now taking her money out of BofA and will only deal with the CU exclusively.

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^

Thats been my experience with banks vs. local banks and credit unions. I don't even fool with the large banks anymore, except for RBC and only because the local bank I got my mortgage from turned around and sold the mortgage to RBC. Other than that, everything else is with a credit union. When I first went for my mortgage, they DID pull my credit report with the score , but it was only one tool they used in determining what they would give me for a line. They used it only to see what my payment history was really and to calculate income/debt ratio. My credit union did the exact same thing when I got my credit card through them.

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