I know I’m getting to be a broken record on this, but how long will this country keep trying to cure the disease with the disease?
Headline: “GMAC loosens credit to make vehicles easier to buy.” Call it the subprime auto loan prescription.
Easier auto loans for more people.
The struggling financing arm of General Motors Corp., rescued by $5 billion in federal aid on Monday, plans to use some of the money to make cars and trucks more affordable to a larger pool of customers.
It’s the first time that a financial institution has said it will use money from the $700 billion bank bailout to offer more affordable credit to consumers.
On Tuesday, Detroit-based GM said it will offer zero percent or low-interest financing on some slower-selling 2008 and 2009 models as part of a year-end sales push — a move made possible by the newly available cash at the financing arm.
Translation: More bad loans to risky borrowers.
Flashback Nov. 25: Borrow. Spend. Panic. Repeat.
Mish sums this madness up perfectly:
The more money wasted on stupidity like this, the longer the recession, and the slower the recovery. There is only so much capital, and using that capital to keep failed business models alive is sickening.
Pardon me while I bang my head against the wall some more.