Baltbear on Finance markets are like marshmallows

last november 8,
i posted this artulce, setting yp the most immediately “shovel ready” revoceryt program possible:
http://baltbear-on-finance.com/the-10-cent-solution-for-gm-f-etc.
that article was forwarded to a number of congresspeople, including nancy pelosi, by regular readers of this blog, which was begun, among other reasons, precisely to get suystainable trhinking into the marketplace instead of hype.
a very watered down version of the 10 cent solution passed congress and immedately led to serious success at improving fuel economy, market economy, and revitalising main street and the assembly lines that run 10% of the usa economy.
what did not pass was the anti-gimmick, no free lunch portion of the porgram:
a 10 cent a gallon federal tax to be used to actively fund he program, and make the rebates (currently $4500) truly meaningful–like $8k meaningful–so hat more members of the general economy could benefit.
tell your congressman, now that another $2 billion is going into this plan that you want to see it funded permanently, realistically, not gimmickally.
gasoline prices are back in the $2.50 range in my travels, which indicates according to my charts, a bottom forming in the overall econ. that bottom, can be broken, and will be, by any other oil shock. gentle pressure on oil demand, and strong relief for oil demanders will make a difference.

Posted under business

today gm announced it can see the end of its cash reserves.
conbress has already told gm to go take a hike.
is this a poker game, gm bluffing to see if congress folds?
probably, becuase neithr side wishes to deal with the issues:
the roads are filled with cars that people value, becuase thy have no choice.
while oil is “cheap” and to kep it that way, a 10 cent fuel tax,
with the proceeds to go to buying cars made before 89 off the roads,
cars turned into tuna cans, not “recycled” as cars,
buying the cars at their original retail price with vouchers usable
only for buying cars made after 2002 that meet forward looking cafe goals
would get assembly lines moving again, provide locked base leverage for
extending credit, reduce health care costs, reduce oil dependence.
directing such vouchers back to the car “makers” as tax offsets, or
to be exchanged rirectly for r&d money maintains the forward motion,
and the delivery channels already exist between dealers and makers.
used car lots can use the vouchers as payment for floor plan with banks.
banks can hold the vouchers as capital for loss reserves,
and a clear, fast, utterly trsanparent market can immediately appear
for moving the “cash” value of thse vouchers, in th same way that a dtc
can keep track of “street name” equities.
ten cent a gallon equals about $18 billion dollars.
cars being taken of the road, let’s call it $8000 each,
thereby retiring 2.25 million cars, without “debt”.
invoke debt against tax revenues as a model, and double to 4.5 million cars a year.
let’s pretend there is shrinking dependence on a dead car in the driveway,
and say a demand for an additional 4 million vehicle units a year is created.
is that enough to bail out gm?
ask your congressman why it isn’t being done.
and pass this post along to anyone you know
who pretends to be “looking for solutions.”

Posted under business, finance, investing