Thursday, August 25, 2005

Cracks In US Economy Expanding

Cracks In US Economy Expanding

GM, Ford Motor Debt Ratings Cut to Junk by Moody's (Update1)
Aug. 24 (Bloomberg) -- General Motors Corp. and Ford Motor Co., the two biggest U.S. automakers, were lowered to junk by Moody's Investors Service. Moody's lowered General Motors Corp.'s rating two levels to Ba2 and the rating on its finance arm to Ba1. Dearborn, Michigan-based Ford was cut one level to Ba1, one step below investment grade. Moody's also reduced its rating on Ford Motor Credit Co. to the lowest investment grade. The Ford cuts affect about $150 billion in debt, Moody's said in a statement today. It's the second junk rating for Ford after Standard & Poor's lowered the company to non-investment grade on May 5. That will push the automaker out of the most widely followed investment-grade bond index by Lehman Brothers Holdings Inc. and may spark selling of the bonds. Chief Executive William Clay Ford Jr., 48, saw his company's share of the U.S. auto market fall for 28 straight months through June. In July, sales rose 29 percent after the company offered employee-pricing discounts to all consumers. - 08-25-05

As the media focuses on the pros and cons of Cindy Sheehan’s challenge to George Bush to face her and answer her questions about why her son had to die for his lies, the beat goes on. The beat in this case refers to the real deal about the AmeriKKKan culture and economy. This week’s flap about Pat Robertson calling for the US to assassinate Venezuelan president Hugo Chavez is part and parcel to the continuing moral melt down of AmeriKKKa. Robertson was one of the prime movers of the Christian Right, Bible thumping fascists who support the Nazification of AmeriKKKa who use the veneer of religiosity and morality to camouflage their bloodlust and megalomanical imperialism. Cindy Sheehan is like the little boy in the Hans Christian Anderson story The Emperor’s New Clothes, the only one in the relam secure enough in their grasp of reality, rectitude to spontaneously acknowledge and proclaim the truth, the man in the parade of pomp and pageantry was as naked as a Jaybird. By refusing to directly confront Cindy Sheehan, Bush has further bunkered himself in his Bizarro World where colonialism is freedom, larceny is endowment and lies truth. Meanwhile in the economic sphere two major giants of US industry and capitalism: General Motors and the Ford Motor Company and their credit lending arms GMAC and Ford Motor Credit Company respectively have suffered another major setback. GM and Ford who employ thousands of AmeriKKKans and whose vendors, suppliers and credit customers form an impressive network within the domestic and global economy (both automakers now own foreign companies like Saab and Jaguar) have been losing money over the last year or so. In May, Standard and Poor investment dropped both companies' bond rating to junk status and recently Moody’s Investors Service did the same. This means unless their fortunes change and sales improve drasticly, investors will not buy their stocks and bonds further endangering both companies’ ability to remain competitive and viable. With labor contract negotiations looming with their unions, this does not bode well for the working class wage earner.
Bush may call himself the "War President" but his handling of the invasion and occupation of Iraq is not going well. His approval ratings and credibility are at an all time low; rightly so since he and his Chickenhawk NeoConmen are the ones putting AmeriKKKans at risk for a lie while Bush the liar was a draft dodger who went AWOL for over a year from his Texas and Alabama Air National Guard units. Since his installment as president in 2000 Bush has presided over a slumping economy much of which he blamed on 9-11 rather than corporate malfeasance, greed and corruption. Even as the economy has rebounded AmeriKKKa witnessed a protracted “jobless recovery”. If GM and Ford go belly up it would create an economic tsunami that will engulf workers and Wall Street. Yet you never hear Bush and Co. utter a mumbling word about this or the fact US bankruptcies are at record levels. According to a BusinessWeek Online dated 08-24-05 bankruptcies have hit record number during the last two quarters. “The number of bankruptcies in the United States surged to an all-time high in the second quarter of this year as financially troubled consumers scrambled to file before a rewrite of bankruptcy laws takes full effect. Bankruptcy filings to federal courts in the April-to-June quarter totaled 467,333, according to data released Wednesday from the Administrative Office of the U.S. Courts. That marked a record number of filings made in any quarter. Of that total, most -- 458,597 -- were personal bankruptcy filings; the remaining 8,736 were businesses filing for bankruptcy, the data showed.” The article anticipated another jump during the third quarter of 2005 just before the new bankruptcy law goes into effect in October. “The record 467,333 bankruptcy filings in the second quarter surpassed the previous quarterly high of 440,257 filings in the second quarter of 2003, said Nathalie Martin, a resident scholar at the American Bankruptcy Institute.” What the article failed to mention was the new bankruptcy law was written by the major banks, credit card companies and is part and parcel of the Bush administration’s and Republican Party’s bend over backwards support of corporations and big business to the detriment of the little man and woman, their not too subtle form of class warfare. Perhaps this why Bush’s approval rating is plummeting so rapidly.



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