Suspended

by Larry Levin


I'm taking a break from the market news tonight as I had a thought while reading the following piece from the AP. To be sure, both issues are relevant to our economy via extension the S&P500 but I thought "what the hell" I'll throw it out there.

Do you remember the "cash for clunkers" bill passed by Congress not too long ago? I wrote about it. It was another handout to the auto industry via your tax dollars. No need to Google the specifics I guess; the whole program is already being suspended.

From the AP (in part):

The Transportation Department called lawmakers' offices to alert them to the decision to suspend the program at midnight Thursday. The program offers owners of old cars and trucks $3,500 or $4,500 toward a new, more fuel-efficient vehicle.

The congressional officials spoke on condition of anonymity because they were not authorized to speak publicly.

A White House official said later that officials were assessing the situation facing the popular program but auto dealers and consumers should have confidence that transactions under the program that already have taken place would be honored.

Rae Tyson, a spokesman for the National Highway Traffic Safety Administration, which administers the program, declined comment.

Congress last month approved the Car Allowance Rebate System program, known as CARS, to boost auto sales and remove some inefficient cars and trucks from the roads. The program kicked off last Friday and was heavily publicized by car companies and auto dealers.

Through late Wednesday, 22,782 vehicles had been purchased through the program and nearly $96 million had been spent. But dealers raised concerns about large backlogs in the processing of the deals in the government system, prompting the suspension.

A survey of 2,000 dealers by the National Automobile Dealers Association found about 25,000 deals had not yet been approved by NHTSA, or nearly 13 trades per store.

Uh-huh, suspended in less than 1-week. The government couldn't handle 25,000 deals. There is a bewildering backlog.

And this led me to the "other issue"...wait for it...Socialized Obama Care. The government can't even handle a lil-ole "cash for clunkers" program so it begs the question: how will the "G" perform with TENS of millions of "deals" per month? Per week? Per day? Oh, it will be fun.



Previous Day's Trading Room Results:

Trade Date: 7/30/09

E-Mini S&P Trades*
(before fees and commissions):

1) OTF buy @ 10:30am at 991.00 = b/e & b/e (2 lot)

2) Algorithm positions (15)

3) "Reading the Tape" positions (9) ...combined Secret's, Algo, & "Reading the Tape" total...+7.25


Electronic (YM) Mini-Dow:

1) None today



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