The Romney Ad, the Auto Bail Out and China

The political everybody has an opinion not based in fact pundit world is ablaze over a new Romney ad claiming Chrysler is planning on building a plant in China and making Jeeps there. The ad references this Bloomberg article, from October 22nd, which reports Fiat, the majority shareholder in Chrysler, wants to move some production to China.


When in Doubt, Spin It Out - The Spin and Lies of Manufacturing

The Obama administration, with much fanfare, announced a WTO complaint filed against China on auto parts.

The Obama Administration is committed to protecting the rights of nearly 800,000 American workers in our $350 billion auto and auto parts manufacturing sector.

Export subsidies are prohibited under WTO rules because they are unfair and severely distort international trade. China expressly agreed to eliminate all export subsidies when it joined the WTO in 2001. China benefits from international trade rules and must in turn live up to its international obligations.

While this action is long overdue, the realty is this administration has been complicit with China, refusing to label them a currency manipulator. Additionally the Obama administration has passed even more bad trade deals and is working on a mega bad trade agreement, the TPP.

While Chinese auto part imports have surged 25% in the last two years, so has the overall manufacturing trade deficit. Below is the percent change from a year ago in the manufactured goods trade deficit. This trade deficit has increased 14% from one year ago and 26.3% from two years ago.

manufactured goods per chg 1yr

Sunday Morning Comics - Oh the Horror, Bail Out Now Redux Edition

Sponsored by The Guide to a Successful Political Career - It's not what makes sense, simply the art of nonsense

Cup O' Joe

Good Morning! Rise and Shine! Get that Cup O' Joe...
break out the O.J....hang out with the pooch...time to check out the Funnies!


From an interview with the Dilbert creator:

Q. If Dilbert were real, would he still have a job?

A. No. I'm drawing a series right now where he gets laid off and he has to go through a really tough bunch of interviews to try and get another job. At one point he is asked whether he would take a bullet for a prospective employer and they make him go to a firing range to prove it.

Give Them The Money

Give Them the Money!

Who am I talking about?  Why the United States Auto Manufacturers of course.

America, you've got it all backwards. The outrage should be directed at the financial bail out, not at the automobile manufacturers.

A poll says 61% of Americans oppose the bail out of the auto industry and Senate Majority Leader Harry Reid says the Auto Bail Out bill is dead, they don't have the votes.

More interesting in the poll, people do not believe the collapse of the auto industry will affect them. Well, I have news for you, it will affect you, probably more than you can imagine.

A full fledged Deflationary Bust

This morning the NAPM reported a record low reading on their services index. This is the vast majority of the economy. Yesterday we learned that auto sales also declined by a record amount in November.
What both auto sales and services have in common is a continuing worsening of monthly measures compared with 2007. For example, in August car sales were down about 19% YoY. In September the loss was 21%. In October it was 23%. November's number, released yesterday,was more than 30% off from 2007.

Some time ago, I summarized Prof. Leamer's research on typical business cycle contractions: first housing, then durables (mainly cars and furniture), then non-durables, and finally services. When services go, you are in the full force of the recession. That's where we are now.

In the services report was another bomb: the prices index has also declined dramatically, also to a new all-time low -- from an all-time high only four months ago.

What comes around goes around?

This is a cross-post from I thought that the Economic Populist readers might be interested in the intersection between manufacturing and the environment -- please tell me what you think

How to save Detroit

Irony of ironies, the one set of products that could save G.M. is the one that G.M. destroyed -- the electric trolley systems of America. According to the well-known research of Bradford Snell, G.M. killed the electric trolley, because in 1922 they decided that the only way to increase car sales was to eliminate the competition, decent public transit. So they bought systems, pressured railroads and banks, bought public officials, did whatever they could to replace electric -- I'll repeat that, electric -- transportation with oil-based transportation.

Much Ado about GM, Part 3 of 3

America cannot survive without an industrial base.  We cannot simply be a pure service economy anymore than we can be a pure agricultural one or industrial one.  Our nation is too complex, it's needs are too large to adhere to one type of sector.  The nation would be more at risk to economic cycles if it were to simply go one route or at the very least put most of its focus on say just services.  It would be like many towns in this country where there is only one employer or one type of industry supporting the economy as a whole.  One need only read the latest news about how the City of London is not doing so well because its Financial Services Sector has gone downhill.  Now take that onto an aggregate scale.

But we have alternative car companies who cares about GM or Ford?

Manufacturing Monday: Week of 11.10.08



Welcome, ladies and gentlemen, to another installment of Manufacturing Monday. Today we are going to cover something that has been in the news lately, General Motors.  Well to be exact, the potential bankruptcy of GM, and what it could mean to you.  For many, this is a non-issue, who cares about another car company and a failing one at that?  But indeed, it may just be that a collapse of GM could be worse than that of Lehman Brothers and AIG.  Of course we'll cover, as always, the economic indicators for the past week and what they also mean.  So without further adieu, the Numbers!



The Numbers

Manufacturing Monday: Crazy Venom's Used Car Sale!

Greetings folks, and welcome to another installment of Manufacturing Monday.  If you're looking for updates on the financial bailout, sorry today I'm focusing on manufacturing.  Though I highly recommend the many other, if I may say, much more talented bloggers than I who also cover economics.  Nope, today we're talking automobiles!  So let "Crazy Venom" here show you what's on the lot!


Volt to charge up Flint's economic engine with it's own.