Phoney Recovery Re: Cash for Clunkers Drives Third-Quarter GDP Growth
lo yeeOn
record borrowing, to the tune of a couple of trillion USD, from the
future. Part of that went to Goldman Sachs to help out Warren Buffet's
portfolio set up late in 2008. And part of that went to various car
dealerships and drove up the quarter's GDP. But recovery? It's an
illusion!
lo yeeOn
========
In article <b11oe55t259p8asqq...@4ax.com>,
Obwon <Ob...@real.com> wrote:
>
>Cash for Clunkers Drives Third-Quarter GDP Growth
>
> Dean Baker | Cash for Clunkers Drives Third-Quarter GDP
>Growth
>Dean Baker | The Center for Economic and Policy Research:
>"GDP grew at a 3.5 percent annual rate in the third quarter,
>driven by a 22.4 percent jump in car sales, the result of
>the Cash for Clunkers (C4C) program. This increase in car
>sales accounted for 42.0 percent of the growth in the
>quarter. Consumption as a whole, which grew at a 3.4 percent
>annual rate, added 2.36 percentage points to growth. Other
>components making large contributions to growth were
>inventories, which added 0.94 percentage points; national
>defense, which added 0.45 percentage points; and residential
>construction, which added 0.53 percentage points, its first
>positive number since the fourth quarter of 2005. The surge
>in car buying will be reversed in the current quarter, as
>the main effect of the C4C was to pull car purchases
>forward. As a result, the auto sector will be a substantial
>drag on growth in the current quarter. Apart from the auto
>sector, consumption grew at a 1.0 percent annual rate."
>Read the Article
>
>http://messenger.truthout.org/ss/link.php?M=178958&N=339&C=ec0a68b6adc0d76de1c2a4282d2daf54&L=3105
>
Phlip
> The bailout "works":), doesn't it? Uncle Sam (our government) made
> record borrowing, to the tune of a couple of trillion USD, from the
> future. Part of that went to Goldman Sachs to help out Warren Buffet's
> portfolio set up late in 2008. And part of that went to various car
> dealerships and drove up the quarter's GDP. But recovery? It's an
> illusion!
So, you admit that an initiative as simple, expedient, & emergent as
that tiny little Cash for Clunkers actually drove up the GDP?
I wonder what Obama's long-term plans will do for us...
--
Phlip
http://c2.com/cgi/wiki?ZeekLand
Obwon
Bush couldn't let them go to bk court as they would have
if he didn't act quickly. Worse case scenario would have
been to have Goldman Sachs in bk court, that could not be
allowed to happen, it probably would have put them all in
prison, Bush and Cheney included. But that's another
matter. Many of these subprime loans were packaged and sold
to overseas investors. When the scandal hit, overseas
gov't's decided to take possession of those bad investments,
making the investors who brought them, whole.
So that now all these gov't were in possession of claims
against these high flying American Corps. Instead, of what
the sellers had supposed, namely that the holders would go
bankrupt and be blown away with the winds. Thus, wiping
out and/or making it easier to settle claims, for a very
small fraction of their worth, with desperate private
entities struggling for their very lives.
Instead, they now had foreign gov't's to deal with, which
as everyone knows, have the resources to persue their
claims for a very long time and in very powerful, coercive
and compelling ways. Bush could not pay them off directly,
that would have looked very bad indeed. So the scheme
devolved into "Bailouts" for American Corps, who would
then buy in the paper in foreign hands. Thus lots of money
could be moved around in various ways, without calling much
attention to the fact that the scheming had in fact damaged
the U.S. gov't financially and politically worldwide.
There's been so much fraud, so many lies and cover ups, I
could easily suspect that those inordinately large "bonuses"
were part of this money moving effort as well. Who knows?
All we know is that once the money is "privatized" it is
then free to go anywhere the holder pleases and for whatever
reasons as well.