advanced econ

Should We Really Bail Out the Big Three Automakers with $73.20 Per Hour Labor?

Bankruptcy is a provision to give struggling companies an opportunity to rationalize their business models. Thus enabling them to return to profitability.
They only need a bailout to avoid rationalizing their business model.


On Nov 14 01:28 AM The GM Kid wrote:

> You are so RIGHT!!!!!!! I am still trying to figure out why AIG gets
> 120 billion?? And GM gets "Bankrupt"??... whats wrong with this picture???Obviously
> we are all fools for not being execs in wall street. what an elite
> club....
>
>
> On Nov 10 09:14 AM Herbert Hoover wrote:

Should We Really Bail Out the Big Three Automakers with $73.20 Per Hour Labor?

I am concerned by the lack of economic reality and the rationalization that goes on in many of these posts.
Economic resources are not unlimited, they are finite, and the question is always what is the best use, not what is the fairest use of resources.
How can you argue that the GM's business model makes sense but they need a bailout? You don't need to bailout thriving business's.

The Fed Is Still Expecting Inflation to Moderate

The Fed is right? The Fed wouldn't know right if it walked up and punched it in the nose, which is what it deserves.
A deflation would mean the dollar had strengthened to parity or better with the Euro and a gold price of 450 or so would confirm it.
We are a long way from a deflation.