How Can the U.S. Consumption Economy Survive Without Consumers? By Bill Glynn

Who is going to be buying cars? Answer to that: very few. So bail out the auto industry - and it will happen - and they will find themselves right back in the trough again because they can't sell as many cars as they once did. Do we really think people are going to be traveling all over? No, they can't afford to and wait until the credit card companies cut up to 40% of the available credit of consumers. The consumer is already cut off from home equity, refinancing, and will emerge regardless of bailouts hobbled at best. Well, what does that do to the consumption economy businesses depend on? Yes, a car wreck no matter what.

I use the car wreck analogy because as businesses like the auto industry, which is topical, are bailed out, even if you and I don't agree, the consumer certainly isn't going to be out buying cars and, worse, many just can't. Consumers now suffer from 30-60-90-120 day lates on their credit reports. Consumers are unemployed and with an Obama program of "Great Works," the consumers supporting the economy will find themselves under-employed even if they go build bridges and roads. May be great for job numbers and political equity, but overall for the economy it will fail to meet the massive waves of chaos that have hit our shores and will continue to drown many industry sectors. [more...]