stefalb

As Goes GM, So Goes U.S. Government Credit

Because there are plenty of guys out there with small d**ks who need big cars to boost their ego. As long as they can afford them a big part of the American population rather buys SUV's.


On Jan 05 12:00 AM a. palmer jr. wrote:

> I saw a neat little car on tv today. It was a Nissan (I forget the
> other name) but it costs less than $10000. It's probably a pretty
> good little car. Why can American car companies come up with something
> like that instead of pushing suvs?

As Goes GM, So Goes U.S. Government Credit

The money comes from the car buyer. The buyer makes his monthly payment to GMAC. For the buyer this payment is calculated on 0% interest. GMAC or the dealer buys the car from GM at a lower price, discounted to reflect an interest rate, margin, and risk premium, agreed on between GM and GMAC. It is all internal accounting.


On Jan 04 02:18 PM Geary wrote:

> Stefab -
>
> Do you actually read what you type - WHERE do you think the money
> "paid" to GMAC by GM comes from? Are you datf?

As Goes GM, So Goes U.S. Government Credit

GM is offering 0% financing, not GMAC. The finance cost is included in the sale price of a new car and GM pays GMAC for the service and the risk.


On Jan 04 11:23 AM sangellone wrote:

> Could someone explain to me how GMAC can offer 0 percent financing
> when it is paying 3.75% for deposits and 8% on its US Government
> loan?
>
> Remember this outfit is headed by J. Ezra Merkin who invested heavily
> in Bernard Madoff's Ponzi scheme. Surely the US Government should
> demand his resignation as someone this incompetent with other people's
> money should not be trusted with taxpayer's funds.

As Goes GM, So Goes U.S. Government Credit

If housing were the real dominant force behind the slump in car sales then the author would be right but I make the point that high gas prices were the driving force. The credit crunch intensified the problems by cutting off credit to interested car buyers. The support for GMAC and soon Ford Motor Credit alleviates the credit problem and much lower gas prices will make buying a new car much more interesting. GM and Ford still produce some of the most popular cars in the US. The argument that nobody wants and buys their cars is ridiculous. Easier credit and lower gas prices will make for some interesting car sales the coming months. Short sellers will get creamed. It will be fun to watch!!!