Posted: Sun, 26 Jul 2009 03:06:00 +0000In June, President Obama signed the Cars Act. It makes $1 billion available for Americans that trade their fuel inefficient vehicles for brand new, greener ones.
Some dealerships have accepted cars in the program since July 1. However, most dealers were waiting for Friday in order to closely examine the program's final guidelines released by the National Highway Traffic Safety Administration. Dealership interest was so great on Friday and Saturday that the fed's computer certification system crashed several times. Over the weekend, other federal sites that distribute consumer information about the program were also reportedly sluggish due to the overwhelming demand by new car buyers.
The program provides for up to a $4,500 consumer credit on an inefficient used car and applies that rebate to the purchase of a brand new fuel efficient vehicle. The motivation is to get more environmentally friendly cars on the road and at the same time boost new car sales. Judging from spot market reports on Saturday, the program may have hit it's mark -- initially at least.
Spokane, WA, Ford dealer Wend le Ford said that their car lot was the busiest it has been all year. "This is the biggest thing to hit the new car side of the business in a long time," said Andy Keys their General Sales Manager. "We had probably 70 to 80 people in the store on the program yesterday."
Clunkermania was also reported in the Los Angeles area. "We've clearly had traffic coming in that's being driven by 'cash for clunkers,' " said Marc Cannon, spokesman for AutoNation Inc., which owns 77 dealerships in California, "We started doing deals early this morning."
At Koons Ford of Baltimore, Russell Martin reports that customer traffic at their dealership has picked up by 30 percent to 40 percent since the program was signed into law last month.
Additionally manufacturers are now stacking additional rebates atop the "clunker money" to create some of the best new car deals that drivers have ever seen. Chrysler, for instance, says it will match the government's money for consumers who turn in a clunker and buy a 2009 model.
In St. Louis, MO, Steve Cancila, of Cancila Chrysler, exclaimed, "I never imagined that something the government came up with would be so successful... and I haven't seen [manufacturers] rebates like this in 10 years. It's insane the amount of money they're offering right now."
The new car sales kick-start followed surprise after surprise this past week. Early in the week conference board indicators gave more proof that recovery has started in the US Economy. Throughout the week, the vast a majority of stocks posted better than expected earnings, including a multi-billion dollar profitable quarter from Ford. US taxpayers got a 23% return on a huge TARP payback from Goldman Sachs. Existing home sales increased for the third straight month while starts of single-family homes have risen four straight months through June.Finally the week saw stocks break various records, as the Dow Jones Industrial Average topped 9,000 to set a new highest close for the year. Continuing the recovery pattern of 1975, the index moved sharply higher, leaving many skeptical investors in the dust.Feel free to repost this story on your favorite social network...
Posted: Thu, 23 Jul 2009 04:36:00 +0000Federal taxpayers received a 23% annualized return on their investment in Goldman Sachs. On Wednesday Goldman announced that calculation by combining the interest it paid before repaying the Treasury’s $10 billion principal loan with the warrant buyback payments it made this week.
Goldman as led the way this week with surprise Q2 earnings... profits made on the back of government support for the firms.
Several analysts agree that Sachs paid fair value for the warrants. But JPMorgan Chase continues to haggle with the government over the value of its warrants. Whether or not JPMorgan ultimately settles or forces the government to auction the warrants on the open market, the TARP program is certainly turning out to be aboon for taxpayers.Feel free to repost this story on your favorite social network...
Posted: Wed, 22 Jul 2009 02:46:00 +0000Of the 72 public companies followed by Briefing.com on Tuesday, only 9 stocks missed their earnings estimates. That follows an extremely positive market performance on Monday when only 3 of 30 firms missed their number.
Of the 59 issues that beat their estimates Tuesday, they beat them handily. Those companies providedsurprise after surprise to the upside -- averaging $.10 per share better earnings than consensus projections.
Of particular note, Apple (APPL) blew past analysts forecasts of only $1.17 per share. The iPhone and Mac maker, posted an extremely impressive $1.35 per share earnings or a net profit of $1.23B in Q2. Apple joined IBM (IBM) and Intel (INTC) in setting expectations for Q3 2009 GDP growth that will be anything but lackluster.Feel free to repost this story on your favorite social network...
Posted: Tue, 21 Jul 2009 06:01:00 +0000Since early June we've been observing more and more markers that US economic recovery has started.Monday brought even more data to support that assertion.
A close look at the elements of Monday's Conference Board report supports the view that the recession ended in June and recovery has indeed begun. The CB's leading index posted a third month of consecutive gains rising 0.7 percent in June. Again the gain was much stronger than most economists had expected.
With reporting of the June data, several recession-ending items within the CB’s report are now in place. Most economists agree that these data need to be in place before a recession is officially considered over...
1. Three straight gains in the ratio of coincident-to-lagging indicators, (check)
2. Three months of 50-plus readings in the diffusion index, (check)
3. Three consecutive gains in the leading index along with an annualized reading over that period in excess of 10 percent. (The data shows a 12.8% annual rate -- the best since Jan 2002) (check)
The three check boxes follow last week's Economic Cycle Research Institute (ECRI) Weekly Leading Indexwhich surged to an annualized five-year high of 7.0%.
This is just more data to support the claim that when NBER's cycle-dating committee finally marks the official 2008-2009 recession end, it will point to June 2009.
You may recall a professor from Kansas make that recession-ending prediction back in November 2008.Feel free to repost this story on your favorite social network...
When all you read is gloom, turn here for a much different perspective.
Sunday, July 26, 2009
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