Thoughts On Finance

There has been a lot of press given lately to the fact that the major auto manufacturers, General Motors, Ford and Chrysler are asking for a 34 Billion dollar bailout for their companies.  As are many average Americans, I sit and wonder why it is the average American’s are struggling but the big companies can get help, and we sit completely helpless, waiting and hoping for things to turn around.

Unfortunately, I have learned that the main reasons that these bailouts are necessary is to save the overall economy of the country.  I did see that with the banking and credit industry, however it didn’t make as much sense to me when it came to the auto industry.  Sure, I could see that it was going to put the people in the auto industry out of work, which obviously would cause great economic hardship, especially in areas of the country like Michigan who rely on the auto industry to support most of the other businesses in the communities, however, I was really unaware of the ripple effect that the destruction of this industry would have across the country.  The fact that I didn’t consider and really was completely unaware of, was the fact that the US auto manufacturers are the biggest purchasers of American-made steel, aluminum, iron, copper, electronics and plastics. The decline of the American auto companies is one of, if not the most important, areas where our economy is struggling.

Expert financial analysts predict that allowing the US Auto Industry to fold would be one of the biggest hits to this country’s financial state that has ever occurred.  They feel that in order to keep the economy even remotely stable it is going to take a bail out of significant proportions of the US auto manufacturer’s.