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Thursday, February 19, 2009

The Case for an Auto Bailout

In taking a closer look at yesterday's industrial production release, I pulled all the data, and sorted those industries showing the largest drop in production over the past 7 months (7 months is the furthest back the Federal Reserve details at this level).

Not surprising, the largest drop in production was within the auto industry. What did surprise me (it shouldn't have) was how sharp the decline was.

While I am not saying a bailout is the answer, I am not sure how any business would be able to survive when production goes down this much, this fast.

Source: Federal Reserve