Thursday, April 02, 2009

Auto Bankruptcy will worsen the slowdown

Obama has been decisive in Auto bankruptcy case. While the intent is commendable, letting Auto companies go bankrupt will damage the US economy more.

Auto Companies represent a really big and powerful wealth distribution engine. At this point, wealth distribution engine health determines how much bailout actually reaches the common person who is at the heart of bailout.

Obama saved banks to ensure credit lifelines to the common person survive. But if auto companies go bankrupt, they take pensions, incomes and multipliers with them. It will be like preventing heart blockage but stabbing the patient! 

I hope Obama gets his team to explain these things to him before he signs off on anything! Just pray!