- In case you needed any evidence, the credit crunch is now working full steam through the economy: U.S. manufacturing hits a 26-year-low, per the Washington Post, and car sales are at their lowest in 25 years, per the Financial Times. Meanwhile, a Federal Reserve survey shows credit growing even tighter.
- It appears I spoke too soon yesterday when I said that Treasury’s rejection of General Motors’ aid request was a sign it was not going to expand lending beyond banks. According to the Wall Street Journal (most of the article is behind a paywall), GE Capital, CIT, and others could soon have access to federal largesse. My frustration lies not in the wisdom of expanding the bailout--particularly when it comes to consumer-focused firms like GE Capital, doing so seems a good way to get credit to the public quickly--but rather in the way Treasury sold the plan as a rescue package for banks, but is now claiming a much larger mandate. Then again, that’s probably the only way they could sell it, so color me a bit impressed, too.
- Great coverage of the slowdown in the Chinese economy, all over the place. Of course, slowdown is relative--its 9 percent annualized growth in the third quarter would make western central bankers flip over inflation fears. But China needs at least 8 percent growth to keep pace with its labor market; otherwise, worker unrest, already disruptive, could become a serious national problem. How China deals with the global slowdown may be the story to watch over the next year.
Now, go vote.