Suspend "Cash for Clunkers"?

[4444CJones4444]

Quote from Robert Weinstein:

Does anyone give any thought to what this does to our economy???

Your post is full of valid points, but I don't think the consequences will amount to much of anything. From what I've heard (I know several people who work in new car dealerships), the VAST majority of clunkers are worse than worthless. Some, like the Volvo in the video, still have some value, but the damage is limited to the engine. It's my understanding that the vehicles are towed to the junkyard and parted out once the engines are damaged (which is necessary to keep the vehicle from immediately hitting the road again and we all know that's exactly what would happen).

The last time I checked, 251 million cars and trucks are registered in the U.S. So far about 200K shit boxes have been traded in and scuttled. That amounts to .08% (not 8%, not .8% but .08%) of the vehicles in the U.S. I don't think that number is sufficient to distort any market.

 

[Robert Weinstein]

Quote from 4444CJones4444:

Your post is full of valid points, but I don't think the consequences will amount to much of anything. From what I've heard (I know several people who work in new car dealerships), the VAST majority of clunkers are worse than worthless. Some, like the Volvo in the video, still have some value, but the damage is limited to the engine. It's my understanding that the vehicles are towed to the junkyard and parted out once the engines are damaged (which is necessary to keep the vehicle from immediately hitting the road again and we all know that's exactly what would happen).

The last time I checked, 251 million cars and trucks are registered in the U.S. So far about 200K shit boxes have been traded in and scuttled. That amounts to .08% (not 8%, not .8% but .08%) of the vehicles in the U.S. I don't think that number is sufficient to distort any market.

Hello 4444,

I think you make some valid points as well. Perhaps the impact is small but I think we can agree there is some negative impact. I would go so far as to argue that a 1/2% reduction in the availability of cheap cars would result in an increase in prices for cheap cars of over3 or 4% and if the actual reduction of cars is say 2 or 3% then a greater than 10% increase in prices could be the end result (great if your selling the car but not so great as a buyer)

The other side of this coin is that the government not only spent a billion dollars on this but all the time (think money) and expenses administrating the program(again I will grant you that perhaps small by some peoples standards). Like someone said before (dont recall who) if you spend a billion dollars here and a billion there pretty soon you have some real money being spent. These are dollars that we have to borrow to spend. So I guess I don't like any of it. But of course this is all just my opinion and obviously there are those that think I am wrong (DC and car dealers are two I can think of)

I hope you have a great weekend

 

[countryBoy]

Quote from Robert Weinstein:

Does anyone give any thought to what this does to our economy???

From what I have heard, there's loads of scam going on here. Nothing new.

But, for anyone who is capable of taking a deep breath, like Robert Weinstein has noticed, what does this do to the economy?? Is this gonna be like Community Reinvestment act? Or in the same post, is the next thing, torch your energy in-efficient home?

These idiots in Washington have no respect for property. They think there is no consequence for destroying it, or not paying for it.

This can only lead to ruin. All property is worth something. If you just go around destroying stuff, the economy will suffer. That's why countries with wars inside their borders rarely have positive GDP.

The obama people know nothing of economies. They only know mob psychology.

 

[Vertex]

A friend of mine has been looking to trade his compact truck for something with a little more room. Like a small SUV.

So, he is looking to trade a 26mpg Ranger for a 19ishmpg Explorer.

He claims the dealer started pitching the "Cash for Clunkers" to him. The dealer, when confronted with the fact that a 26mpg Ranger should not qualify for the program responded with "No, problem! We can fix the paperwork and everything will be fine."

Hehe, as corrupt as our government is, I dont think they have any idea what they are getting themselves (us?) into when they start working with crooked car dealers.

 

[TGregg]

If there were a Biblical-type end of the world prophecy from a financial perspective, it might include a passage like:

"And they shall believe that the way to goodness and plenty is through massive taxes, government control of everything, excessive borrowing and the destruction of property. And the more misery these things bring, the fiercer the cries for more taxes, more government, more borrowing and more destruction until there is none left to pay the taxes, none to be ruled by the government, no money to lend the government and no property to be destroyed. And then, they shall know that they choose this path with full awareness of what was to come."

Not saying it's the end of the world, but I am saying it's a step closer rather than a step further away.

 

[jprad]

Quote from Robert Weinstein:

Want to see what they are doing with the cars to make sure no one drives a Clunker again. take a look at the youtube video.

It's pretty obvious that the car in the video is in the process of having it's engine destroyed, but can we just stop and think about this a bit?

The car in the video is a late model Volvo sedan. Well, according to the CARS web site, there's pretty much only one model Volvo sedan that qualifies, an S80 AWD 4.4L 8cyl.

The trade-in value on a 2008 edition of that car with 50K miles is about $20K and the retail value is going to be close to $30K.

So, someone's going to short themselves over $15K by going the clunker route?

Sorry, there's more than meets the eye here.

 

[MattF]

Quote from Sandybestdog:

Yea sorry but the major glitch is on you. The dealer, not the customer, applies for the rebate. They sell the 15k car for 10.5k (a loss) and then get reimbursed by the feds. You think the dealer is stupid? They aren’t going to sell a car at a major loss if there’s a chance they won’t get the rebate.

The opposition to this program around here is that people are so shocked that a government stimulus plan was so incredibly successful that people want to shut it down. Look at what just a billion did. Imagine if we used the 25+ they gave to Citi to do something better than pay their bonus checks.

So maybe I was wrong a bit on the last part. But, the dealers are also still taking a risk if the salesman wants to push the deal through.

There are still people pissed because they not only have traded their car in...they haven't gotten the car they bought yet due to the red tape.

Report from WIVB:

http://www.wivb.com/dpp/news/red_tape_slows_clunkers_program_090730


CHEEKTOWAGA, N.Y. (WIVB) - Car dealers are the squeaky wheel on this one, complaining that impossible rules from Uncle Sam are throwing a monkey wrench into the "Cash for Clunkers" program.

Dean Jackson showed News 4 rows of new cars they have already sold at Keller Chevrolet through the "Cash for Clunkers" program since Monday, just sitting there.

And the angry buyers want their cars.

Dean Jackson of Keller Chevrolet said, "They want to pick up their new car. The government put this thing out July first, we are now pushing August first, and no one is driving."

That's because the government is backlogged approving the cars being traded in as "clunkers." Under the program, the clunkers have to be disabled, by destroying the engines, before the dealer can apply to the government for a rebate.

Niagara Frontier Auto Dealers Association President Paul Stasiak of the Auto Dealers Association said, "According to the letter of the law, the dealership has to disengage the engine. He has to put a liquid glass in the engine, before he is eligible to apply for the federal rebate."

Which means a buyer might have to go days waiting for a new car, while their trade-in has been destroyed.

And Stasiak told News 4 consumers are pushing back, and the dealers are bearing the brunt, "The dealer did everything he could. He took the car in, disengaged the car, applied for the rebate, and is waiting for the government. But as this delay occurs, the anxiety level is rising at a record rate."

Congress is also getting an earful, and New York's senior senator, one of the champions of Cash for Clunkers, says this clunker better get fixed.

Senator Charles Schumer said, "This was not in the legislation we passed, and some sort of bonehead decided to do this, and we have to undo it quickly."

If you went to the government's website, www.cars.gov , a week ago to check the value of your rebate, look again. Officials changed some of those figures at the last minute, and what you thought would be a $4500 dollar credit could turn out to be only $3500 dollars.

 

[Sandybestdog]

Quote from Mercor:

The author is saying the one billion dollars given to the auto industry will help it sell 22,000 more cars then normal. This comes out to be $45,354 of Goverment public outlay per car.
I believe he is saying that it is a lot of money to move one car above normal monthly sales.
He says it is likely this will hurt new sales in the up coming months.

Using that logic, we should discontinue the child credits on our tax returns because people would have had those children anyway and the tax credit would have only caused 10% of people to have another child. That doesn’t make any sense. Or what about the mortgage interest deduction? That’s like saying every dollar saved in taxes on that actually cost $10 because 90% of those people would have bought homes anyways.

The program was intended to spur auto sales, which apparantly much to every “government can’t stimulate the economy” person around here, has been a huge surprise. Therefore the need arises to critisize the program so that Obama looks bad,

 

[Sandybestdog]

Quote from Robert Weinstein:

Yes, Subprime did happen under Bush's watch but in all fairness that was more democrats in congress IMHO than it was Bush's fault. I would go as far to say that it was due to legislation from the democrats as they wanted to push more people into home ownership with government help.

Greenspan DID actually testify to congress warning them about the problems we could face in what many thought was a housing bubble.

It was under the leadership of Rep. Frank and others like him that pushed Fannie and Freddie to keep pumping money into housing. Here is a couple of quick examples (there are MANY more on youtube) that illustrates my point.

BTW, It appears pretty obvious that your pretty far to the left and thats fine if you want to be. I am not a republican and in fact I can find plenty of problems with both parties. I think whats more important than being "left" or "right" of the isle is that your "correct" in your statements. Blaming Bush(who I am not a fan of) is simply wrong IMHO on this one and Democrats should own up to this one just as the republicans need to own up to the problems in Iraq.

Barney Frank is an idiot, so is Chris Dodd, we all know that. I can’t bare to listen to them. But Bush had the bully pulpit and instead wasted our recources on wars and fear tactics. He appointed Bernankrupt and there was every indication that he would continue the same messed up policy’s as Greenscam. Look, I voted for Bush and I’m a Republican (for now), but they screwed things up pretty bad and I’ve been hugely let down by them. So I’m willing to give Obama a chance. I didn’t vote for him, nor McCain and I never would, but good gosh I don’t want him and the country to fail so that Romney or whoever has a better chance at promoting the same things Bush did and failed at.

I haven’t looked at any stats, but I bet those who blame Clinton and the CRA for the mortgage mess are just partisans who hate that poor black people have a chance at buying a home. It’s very simple, look at all the highest foreclosure areas. Florida, Las Vegas, California, Arizona, Long Island, Northern Virginia etc. What do all those have in common? Right, exactly, they were all the areas that were experiencing the huge growth just a few years ago. So maybe it had nothing to do with poor people buying homes, but instead too much money was pumped into the system and eventually it all had to crash. Those hit first are going to be the ones with who have the littlest equity. So it seems logical that the mortgage mess wasn’t created by poor people buying homes, but instead people who paid way too much for them because of the bubble created by the Federal Reserve. Last time I checked, plenty of white people are going into foreclosure.

I know facts are a bitch around here, but please, someone explain this one. One of if not the highest foreclosure rate county’s in the DC area I’m pretty sure is Prince William County. In June the foreclosure rate was 1 in every 2282 home compared to the national average of 89,903. Now PW county is a very suburban mostly white (69% of the population) upper class area and was the 7th highest household income county in the US in 2007. And it is often in the news because of it’s rare crack down on illegal immigration and there are often protests there by immigrant organizations. So, why then does it have such a high foreclosure rate? Well just a few years ago it was one if not the fastest growth county’s in the country. The local politicians have been trying for years to slow the growth down. So it seems to me that the mortgage mess has nothing to do with Clinton and the Dems letting poor people buy homes and more to do with Bernankrupt creating a bubble.

 

[fkbsuhites]

You hit the right-turd arguments head on.

These lowlifes are NOT against the program as much as they are against anything coming from a white house with a black man inside.


Interestingly enough, none of these right-turds were commenting when Bush handed out Trillions to his buddies on Wallst.

No comments when Bush Jr gave out a $Trillion on his "too-big-to-fail" bull shit.

Yet these turds make non-stop negative comments on a $Billion program that is directly stimulating the economy


By posting any more on this thread, we run the risk of prolonging yet another useless anti-obama thread on EliterTraitor.

Quote from Sandybestdog:


The program was intended to spur auto sales, which apparantly much to every “government can’t stimulate the economy” person around here, has been a huge surprise. Therefore the need arises to critisize the program so that Obama looks bad,