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Automotive News & Views Cash for Clunkers - Good or Bad Idea?
4110 messages, Last post on Nov 23, 2009 at 11:42 AM
You are in the Automotive News & Views Forum. Your Hosts are steve_ & claires
For questions about how the program works or to discuss program details, please visit our discussion titled, "Cash for Clunkers - Does it Work for You?"
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Replying to: steve_ (Nov 01, 2009 7:11 pm)
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Replying to: gagrice (Nov 01, 2009 7:19 pm) It's a "better" number than Edmunds' $24,000 at least.
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Replying to: steve_ (Nov 01, 2009 7:28 pm) Edmunds.com analysts predict that August’s Seasonally Adjusted Annualized Rate (SAAR) could be just over 13 million, this year’s highest by far. However, a week-by-week analysis reveals that this summer has been the industry’s most volatile period in history, due to the government’s Car Allowance Rebate System (CARS), also known as Cash for Clunkers. “Cash for Clunkers sent the sales rate on a wild roller coaster ride,” said Edmunds.com Senior Analyst Jessica Caldwell. “The SAAR surpassed 19 million in late July, bounced around in the 15 million range early in August and has fallen to around eight million currently. Ending August on such a low note does not bode well for September.” I don't think anyone in their right mind would try to say C4C did not have a strong impact on Vehicle sales while it lasted. I just believe the negatives outweigh the positives by a large margin. Way less than 1% of the population was a beneficiary of the rest of US.
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Replying to: gagrice (Nov 01, 2009 7:07 pm) Actually, it's not even that. The Government just creates the money and makes it on credit. No tax dollars actually spent(though the value of the dollar lowers in response a tiny bit) |
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Some of the positive spin by your friendly local car sales people within this thread is bordering convincing, the folks who buy into the spin are the same folks who have gotten us into the mess we are presently in. I do admit the tax dollars covering this scheme along with the vast moneys eventually required to fully administer the whole thing is but a drop in the bucket. THE BIGGER PICTURE is what we need to focus on! We've allowed ourselves to believe in perpetual prosperity while watching the countries unchecked levels of depth get pushed out infinitumly. The talking heads need to be ignored and common sense must prevail. All of this bail-out money was/is needed, YES! Unfortunately it's not just required as a temporary stimulus injection, it's put in place to keep the house of cards from totally imploding..........I've been called a neocon, doomsdayer and much worst, so be it. As long as I avoid Mr kool-Aid drinker, all's well. BTW, C4C's as been a great success for my family. Our 200,000 mile Buick which was purchased with cash(savings) 9 years ago needs to be retired, Now we're shopping for a new ride with cash(savings) in hand but of course no deals to be found in my neighborhood, all dealers are flush at the moment and want sticker for their cars.
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Replying to: kdhspyder (Nov 01, 2009 6:30 pm) Then there are all the accessories and aftermarket purchases made by those 690,000 buyers. These workers saw a HUGE bump in income meaning that the Feds and states took upwards of 50% of their gross income as well. Everybody that buys a new car for $30K is going to go out and accessorize it? Right! Then....of the extra money received by all these parties consider how may dinners and presents and outfits and vacations were purchased all of which flowed downstream from this 6 week boost Or, maybe they took the money and paid down some of their debt. That's as good an explanation (guess) of where the money went as yours.
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Not everyone is exuberant about money wasted on failed government welfare programs like C4C 
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Replying to: kdhspyder (Nov 01, 2009 6:30 pm) ap Ford surprises with $1B profit; sees profit in '11 Ford surprises with earnings of nearly $1B in 3rd qtr; forecasts 'solidly profitable' 2011 Looks like some of the money went to Ford (Chrysler and GM too). Gosh, I wonder if the government might think it would be a good idea to do another CFC.
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Replying to: gagrice (Nov 01, 2009 5:23 pm) It is absolutely true that from the end of 2008 to June of 09 auto sales were in the pits and those that survived barely did so. Auto sales people with very few exceptions make much more than $30000 in these horrendous times. That's about $2500 per month. However when a sudden bonanza comes along out of the blue and that $2500 month becomes a $10000 month the withholding for that person jumps up as if he or she made $10000 every month. If the typical sales person was being taxed at 15% in withholdings but suddenly hits a $10000 month the withholding rate jumps up to 30-35% or more. Uncle Sam wants his share of the bonanza right away. If the month is a $12000 or $15000 month then our Uncle gets even more. Then there's state and FICA withholdings to be considered as well. Normally these are fixed rates. But 6% and 15% of a $10000 month is a lot more going back to the States/Feds than of a $2000 month. Where did the money from the Tax Credit go? It's pretty easy to find it if you understand the process. Mainly the money stayed at the local level at the dealerships, sales personnel, managers, their suppliers and the junkyards that took in the dead clunkers. The elegance of this program is that it put money into system right at the point of sale so that it would be used immediately and turned over immediately downstream to other small businesses. A good part of the money was immediately sent back to State and Federal treasuries in the form of Sales taxes and increased withholdings.
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Replying to: gagrice (Nov 01, 2009 7:07 pm) |
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Automotive News & Views Cash for Clunkers - Good or Bad Idea?
