The Unwinding Continues
February 19, 2008
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More Shutdowns:
Feb. 19 (Bloomberg) -- GMAC LLC, the lender partially owned by General Motors Corp., plans to close about 75 percent of its auto-financing offices in the U.S. and Canada after losing $2.3 billion last year.
GMAC will reduce the number of offices serving U.S. auto dealers to four and eliminate three of four outlets in Canada, said Barbara Stokel, executive vice president of North American operations, in a letter scheduled to be sent to dealers tomorrow. GMAC had 16 regional auto-lending offices in the U.S., according to a May 17 statement.
``Given the recent macro-economic conditions during the past year and anticipated well into 2008, we need to make structural cost reductions to restore our competitive position,'' said Stokel in the letter. GMAC spokeswoman Gina Proia declined to comment.
All of these structural cost reductions lead to more job cuts and office vacancies. More job cuts lead to more home forclosures and lower taxes for states leading to more headlines like the following:
Study: Vacant and Abandoned Properties Cost Ohio $64 MillionAbandoned homes and vacant lots are much more than an eyesore in major urban areas of Ohio — a new study released Tuesday finds that they’re costing city governments at least $64 million per year.
The total is likely much more than that figure, according to a study by the Community Research Partners of Columbus, which said Tuesday that the cost may actually be 10 times greater once the costs to all cities and towns in Ohio are fully accounted for — and if cities uniformly inventoried all of the vacant and abandoned property within their jurisdictions.
Where will this stop?
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