That risk is very close to the dangerous ramification of my failure to appear in the most recent episode of Ugly Betty. The strategy for the 3 auto makers to persuade the congress to give them a bailout money is to dress themselves up in the banking industry Halloween costume by arguing that if they fail, then their suppliers will fail as well thus unemployment will shoot up, which can drag the American economy into even deeper recession. In sum, their failure will pose a systemic risk for the economy.
I have to say I cannot buy this argument. The bankruptcy is really a overhaul of the current business model of the Detroit 3, which is a function of the recession: sweeping out the bad apples. The production lines or say, the physical capital of the auto industry will still have value and the production will resume once the reorganization of the auto industry is done. This is a necessary process for the US auto industry itself and let the economy do its job, please!
Summer Camp at Hoover - A weeklong program for undergrads.
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