July 5, 2011

HOW’S THAT BAILOUT GOIN’ FOR YA’? Uh oh: GM backlog looking a lot like 2008. “The bailed-out automaker now has a growing inventory in its truck lines of 122 days worth of sales, nearly twice that of its non-bailout domestic competitor Ford Motors for similar lines. With sales flattening in the auto market, GM has now returned to the high inventory of its pre-bailout condition. . . . The federal bailout of GM only made sense if the automaker’s difficulties entirely sprang from the financial collapse (caused mainly by government intervention in housing and financial markets through Fannie and Freddie junk bonds), and had been both competitive and profitable without it. That was obviously not the case.”

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