Market Memory

Will markets remember that Obama bailed out the UAW and gave everyone else the shaft?

My prediction:

Of course they will, for about 15 years. And during that time, if you are a company that relies heavily on unionized labor, you will have a hard time finding private loans at reasonable interest rates.

However, if you are fortunate enough to have need of loans when a Democrat is president, you can safely assume that the government will loan you money… which you will not need to repay. If that money isn’t sufficient, and you fail, the government will simply hand control of the company over to the union, and loan it a bunch more money to “get it back on its feet”.

If the company is still struggling to actually make something people want to buy at a price that they are willing to buy at after that money runs out, the government may give it more money, or it may throw in the towel and give up on it. Hard to say at this point.

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