Kofi Bofah

Paulson's Message to Detroit: Drop Dead

Toyota just announced they will be cutting production today. I don't think the foreign automakers will pick up all of the slack.

Yes, Detroit has destroyed its own self. But, the situation is even more dire now because people that actually WANT to buy cars cannot get financing. The lending units of the Big Three are shackled, unable to access credit markets for short-term financing in order to function efficiently.

Who in their right mind would loan to these guys?

The U.S. Government is the backstop. The only institution with the cash, credit, and willpower to rescue Detroit.

Chrysler is private, and there is speculation that they will 'merge' with GM.

What do you think would happen to the Midwest without the auto industry? The Rust Belt would be the new Appalachia - without the scenery.

You all bring up many good points that I indeed agree with. But, I think that many are underestimating the fallout from the collapse of the Detroit.

Detroit is Hemorrhaging

Detroit, along with the Upper Midwest Rust Belt is in serious trouble. There is no immediate solution to the problem. It is almost like throwing good money after bad money.

The Big 3 miscalculated by pouring so much money into S.U.V. production right before energy costs spiked.