A TARP-athon Moment of Truth
The CEOs of Detroit’s Big Three auto companies will daub on their war paint for another day defending their lives as debate over whether and when the Treasury Department coffers may open with billions in taxpayers’ rescue dollars. For residential construction companies who seek a huge consumer stimulus package whose direct consequence would come as a positive jolt for their interests, they get to see what works and what doesn’t fly with Congress and the agencies by looking at the car companies’ example.
A question that arises is whether the story, covered in today’s Wall Street Journal, “Big Three Plea for Aid,” is more one of collateral damage or collateral opportunity. After the media blitz and blare of the past week or 10 days, there can hardly be a soul alive who doesn’t now know that one in 10 U.S. jobs owes itself to the manufacture and sale of cars. The fact that so many Congressional seats come up for reelection every two years makes it highly likely that a lifeline will be extended.
Which brings us to the collateral opportunity part of the equation.
Will the tactics General Motors, Ford, and Chrysler are using to lobby Congress for help translate? Which of them will home builders’ and their compadres in the Fix Housing First alliance appropriate for use in trying to get equal time and consideration from House and Senate committee leaders and their associates?
CNBC’s Diana Olick clocks in with a post with her view–skeptical–of where housing might fit in the ever lengthening queue of bidders for a portion of TARP bounty.
Big Builder '08 CEO Panel
I’m all about the hope, but I’m also all about talking to the builders, and I don’t see a whole lot of hope there. On Election Day I moderated a panel of three builder CEOs and the Big Builder ’08 Conference. Two were CEOs of public companies, one private. None of them had anything particularly hope-inspiring to say, and all of them spent the bulk of the time pushing their agenda for a bailout. I don’t blame them, seeing as buyer confidence is lower than ever and home prices have yet to hit the water.
New construction represents far less than a quarter of the total number of homes currently for sale, so I guess a bailout for builders will have to come second to a bailout for the overall housing market. But as I sit here watching a hearing about a big bailout for the automakers, I wonder if the home builders aren’t just waiting in the wings.
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This is an interesting article that looks at the housing market from a unique perspective. This is a problem that is slowly getting worse. There need to be some solutions before things get so bad that there is no turning around.