Wine Rack Store Blog

I just turned on CNN and there was a discussion panel talking whether the US Government should give GM, Ford and Chrysler billions of dollars, so that they can survive. Everybody knows that the downturn in the economy has effected all companies. Major brick and morter retailers are hurting with sales volumes less than 30 years ago. Likewise the auto industry is seeing significantly fewer sales. The latest sales figures show that GM is down 45% from the same period a year ago. I know that one argument is that they have made their own bed by making products that are no longer relevant in the new economy. However their list of problems are more than just that. The credit crunch has prevented many of their customers from purchasing their cars and trucks.

So what are choices?

(A) We can let the auto companies go bankrupt, which guarantees their demise. Few potential customers want to spend their hard earned money on a product and know that the company has a good chance to be out of business in the near future. What happens when they have problems or go to trade in their vehicle. Then, there is not just the money issues. What about the hundreds of thousands of people whose income comes either directly or indirectly from GM, Ford and Chrysler. What if they have no jobs?

(B) The government bails out the auto companies. Spends at least $25 billion, over and above the billions that they have already pledged to the domestic auto industry. They have obviously mismanaged their businesses. What prevents them from "blowing" the billions of dollars, and having to return to Governement for further cash injections. The public coiffers are empty. Between the needless war in Iraq, the bailout of the insurance companies and banks. The country has spent trillions of dollars.

This is truly a tough decision. There is already record unemployment (6.5%). To add hundreds 0f thousands of folks to the unempolyment lines would be even harder on an ecomony already in a depression. To pump billions of good money into poorly managed companies is irresponsible. Plus many would argue that America has come to terms with it's changing economy and this is just another sign of that change.

Either choice is fraught with risk.

I guess you have to make a stand. To let the companies fail would be catastrophic to the economy, and even bigger blow to the American society. The problems with the economy ares immense. We hear the uncertainity when we speak to our customers when they are purchasing our wine racks and wine charms. People don't know where the country is going. The people don't need more of their icons to fall.

If the Government is going to give the automobile companies billions, we need to have oversight in what they do. Lets make sure their management is going to change and that they create products which are in tune with the goals of society. Vehicles that have significantly better mileage. Lets make sure the quality standards are equal or better than their competitors. Only then will their futures be somewhat protected. Just like the Wine Rack Store which adds to it's product lines with wine racks and wine accessories that our customers want.

We would love to hear what you think.

Labels: Wine Charms, wine rack, wine rack store