U.S Treasury Secretary Henry Paulson has decided to use the remaining funds from the 700 billion dollar bailout to help unfreeze consumer credit. The credit crunch which has been affecting Wall Street over the last year has finally hit Main Street. It is now harder for consumers to qualify for automobile loans, student loans and credit cards.
If consumers are unable to qualify for auto loans then the troubled automakers will experience fewer sales than now. As it is, automobile sales are down 50% this year over last year. The automobile industry provides thousands of jobs all over the United States. Everyone from car dealerships too to auto parts manufacturers will suffer tremendous losses should the United States automobile industry fails. More lost jobs will not help the current mortgage crises. Although, the Paulson Plan does not call for aid to the automotive industry, it is important that we stand up as a nation to save this dying industry. The government should give tax credits to anyone that buys a brand new American made car. Incentives such as tax benefits for those who buy American made vehicles can only help bolster sales. We need to keep people employed so money can continue to flow through the economy.
Credit card approvals have also seen a decline because of the credit crises as well . As consumers we rely on credit to purchase things that we need or want. These purchases that people would not otherwise be able to make without credit pump billions of dollars into our economy. Consumers need buying power. Without consumer buying power, retail stores will suffer more losses. We are seeing very large retailers like Circuit City filing for bankruptcy. Without credit consumers find it much harder to make larger purchases like televisions and computers.
Less consumer spending will also affect other sectors of the economy like transportation and manufacturing. If goods are not being purchased then they are not being shipped from the manufacturer to the retailer. This hurts everyone from those working in factories, trucking companies, warehouse workers, and all the support needed to keep products moving.
Student loans are also needed to keep our work force trained for jobs of today and tomorrow. Without student loans many high school graduates will be faced to find low wage paying jobs or even no job at all. Education is what keeps our work force competitive with foreign markets. The country needs engineers, teachers, doctors, and other trained professionals to keep our way of life going.
Ultimately, the economy needs credit to continue to grow. Businesses rely on bank lines of credit so that they can pay employees. Retailers count on consumers with credit that spend money at their stores. Without credit, there will be more job losses. Small businesses will have a harder time paying people and will be forced to cut jobs. Retailers will sell less and have to cut jobs as well. These losses will only further worsen the mortgage crises. In order to keep home values from falling any more than they have, we need to keep the country working.
If consumers are unable to qualify for auto loans then the troubled automakers will experience fewer sales than now. As it is, automobile sales are down 50% this year over last year. The automobile industry provides thousands of jobs all over the United States. Everyone from car dealerships too to auto parts manufacturers will suffer tremendous losses should the United States automobile industry fails. More lost jobs will not help the current mortgage crises. Although, the Paulson Plan does not call for aid to the automotive industry, it is important that we stand up as a nation to save this dying industry. The government should give tax credits to anyone that buys a brand new American made car. Incentives such as tax benefits for those who buy American made vehicles can only help bolster sales. We need to keep people employed so money can continue to flow through the economy.
Credit card approvals have also seen a decline because of the credit crises as well . As consumers we rely on credit to purchase things that we need or want. These purchases that people would not otherwise be able to make without credit pump billions of dollars into our economy. Consumers need buying power. Without consumer buying power, retail stores will suffer more losses. We are seeing very large retailers like Circuit City filing for bankruptcy. Without credit consumers find it much harder to make larger purchases like televisions and computers.
Less consumer spending will also affect other sectors of the economy like transportation and manufacturing. If goods are not being purchased then they are not being shipped from the manufacturer to the retailer. This hurts everyone from those working in factories, trucking companies, warehouse workers, and all the support needed to keep products moving.
Student loans are also needed to keep our work force trained for jobs of today and tomorrow. Without student loans many high school graduates will be faced to find low wage paying jobs or even no job at all. Education is what keeps our work force competitive with foreign markets. The country needs engineers, teachers, doctors, and other trained professionals to keep our way of life going.
Ultimately, the economy needs credit to continue to grow. Businesses rely on bank lines of credit so that they can pay employees. Retailers count on consumers with credit that spend money at their stores. Without credit, there will be more job losses. Small businesses will have a harder time paying people and will be forced to cut jobs. Retailers will sell less and have to cut jobs as well. These losses will only further worsen the mortgage crises. In order to keep home values from falling any more than they have, we need to keep the country working.
Labels: automobile loans, credit cards, henry paulson, Paulson Act, student loans
Credit Card / Financial news blog post by Todd Holliday at 7:30 PM 