Obama and the Auto Industy: Heavy Handed?
Hey, I thought this was a capitalist, free economy! All of a sudden, the President of the United States kicks out the top dog in General Motors and tells the company to rework its business plan or else! Then he demands that Chrysler “marry” Fiat. What gives?
Is there still anything to Charles Wilson’s prophetic pronouncement, back in the ’50s, “As goes GM, so goes the country!”? Wilson, then President of General Motors, wasn’t all that far off when he equated the welfare of what was then the world’s biggest auto maker with that of our country. And it probably still applies.
GM is, today, hardly different from any individual that spends more than he makes, has borrowed all he can from normal sources to do more of the same, and finally resorts to loan sharks who act predictably, and not very pleasantly, when he inevitably defaults.
But I’m far less worried about General Motors, and it’s forfeiture of control to our government, than I am about our government which, having borrowed all it can from its citizens, now is hitting up the international “loan sharks” that have been buying up America as fast as they can! “…So goes the country!”
What do you think happens next? How soon? And what, if anything, can we do about it?
Today’s stock market has caused a lot of usually sensible people to shake their heads and say, “This is different. This is unprecedented. It’s never been like this! We need a new set of rules to handle it.”
There was a time when we found it prudent to keep debt to a minimum, save for what we wanted and would need in the future, and use credit only for the purchase of something as significant as a home. Of course, the use of debt in business is quite another story, where borrowed funds are used to pay for things that will generate more than enough money to cover the cost of the loan.
There’s one guy out there who had it nailed a long time ago. A one-man crusader with the tools to expose Wall Street’s flaws, he was on national talk shows, made his points eloquently. Must have felt like a mime on a street corner: everyone could see him, but no one heard him. How frustrating it must have been for him to have been labeled a sensationalist and a paranoid (by those threatened the most) and not be taken as seriously as he should have been then. [Hey, just because you're a paranoid it doesn't mean they're not out to get you!] 
You bet we do! Any time anyone in a position of trust and responsibility takes advantage of that position and steals from those who trust him or her, we have a right to be mad as hell! And, certainly, those top executives who, through some convoluted logic, justify absconding with millions of dollars when the companies they manage are going down the tubes, should be literally tarred, feathered, and boiled in oil! Okay? Let the record show that I’m righteously furious! 
Lively chatter on the NAIC I-Club recently dealt with the topic of expectations. Our methodology calls for shooting for doubling our money every five years. This means that the value of our portfolios is expected to increase, on the average, just under 15% every year. 
I know a lot of smart people who wait for clothing, appliances or even food to come down in price so they can pride themselves on spending less for the things they need or want. 
It’s well known by now that way too many corporate executives are making gazillions of dollars every year in salaries, perks and expenses. What may come as a surprise to you is that they don’t have to do a very good job to get raises each year. Even more outrageous, if by some chance they fall out of favor with the board of directors that hired them, they get even bigger bucks to leave! 
