Date: 16 Dec 96 15:39:31 EST
From: jonathan flanders <72763.2240-AT-CompuServe.COM>
Subject: M-I: Rate of Profit


 >> But I think in the case of auto (and appliance) companies and their
 so-called captive finance arms, the financial terms are part of the
 marketing strategy. Thus, the credit terms become part of the sales 
terms. <<Doug Henwood

Jon Flanders:

  Let's look at this "marketing strategy" from a political perspective. 
When my LC, who is an Italian immigrant, got wind of the interest rates 
of Ford's new Fairlane line of credit, he said "my relatives would get 
arrested for doing something like this."

  So reversing the slide in profit rates comes down to charging usurious 
interest rates to those who can least afford to pay. A group of hard luck 
consumers which Ford correctly figures to be a growth area due precisely
to the dire effects of overall corporate strategy.

  Charging extra high interest rates and reposessing automobiles has 
never been a ticket to popularity. But Fortune 500 Ford gets into the 
business since there is money to be made. What does it tell us about the 
political prospects of capitalism, when the wing-tipped Grosse Pointers 
get into this sleazy stuff? There must be some serious economic pressure 
building up for this to happen.



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