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Congress Wants You to Buy a Car
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When it comes to new cars these days, there’s plenty of supply, but little demand. Congress aims to change that with a provision that was added to the economic stimulus bill that’s just passed the Senate. No question about it … Congress wants you to buy a car this year.
The provision will allow you to write off the sales taxes on the purchase.
Car sales are down by 30, 40, and even 50% with some of the automakers. These new write-offs might just go a long way to getting car sales jump started again.
Or not.
With the credit markets still icy, it’s up to the lenders to make funds available for the folks who really do want to sign on the dotted line. The bankers still hold the deck.
2 Comments
Mike
February 12th, 2009
at 4:56am
Ah, welcome to the wonderful world of demand-side economics, or trickle-up economics, where the government creates demand for the things it wants you to buy… never mind the fact that it probably isn’t something you need. Used cars are still the best value.
Also consider the unintended consequences of this action. If more people pay less for new cars, the resell value of those cars will be considerably less… resell value of new cars is already pretty crappy.
Don’t forget that it was government intervention in trying to create demand for houses for people who couldn’t afford them by ‘influencing’ banks to make loans to these people.
system001
February 13th, 2009
at 6:44am
mike, lets try this again. wall street enticed the banks to make the shady home loans, so the banks could have the capital to invest even more in the stock market. our government is not innocent by any means though. after all they are the buffoons who deregulated everything making it possible for wall street / coroprate america to get away with this.