Something I wouldn't have thought of. From John Farnam's quips:
Credit as a Weapon
19 Feb 09
Sage advice to domestic gun and ammunition manufacturers, from a friend on Wall Street:
"Gun and ammunition manufacturers are ill-advised to dramatically increase
capital spending and work forces, just to address the current feeding-frenzy.
Despite immediate high market demand, it won't last! Eventually, each family
will panic-buy everything they can, until they run out of disposable income.
When pressure from complaining spouses, job loss, and debt-service mounts,
consumers will precipitously cut back spending on guns and ammunition.
Manufacturers who increased debt-load, inventory, and work-force will then find
themselves in a cash-flow crisis!
In order to deal with cash-flow fluctuation, all businesses require short-term
revolving credit lines, and the BHO Administration knows it only too well!
The coming credit squeeze thus represents a subtle way for the BHO
Administration to invoke gun prohibition upon Americans, rather than attempting
to implement direct changes in the criminal justice system, changes which would
be extremely unpopular.
All they need do is pressure banks to stop lending to the gun/ammunition
industry. Banks, mostly nationalized anyway, will, of course, immediately
knuckle under.
It will all be done under innocent-sounding marketing language, like "We are
encouraging banks to focus their lending priorities." Accordingly, when
cash-starved gun and ammunition manufacturers discover their credit has been cut
off, they will be "encouraged" to be amenable with "voluntary compliance" with
new "suggestions" for draconian restrictions of gun and ammo sales.
Thus, smart manufacturers will self-finance production increases from existing
cash flow and refrain from increasing workforces. They will maximize production
from existing machinery and passionately explain to workers that they need to
maximize overtime, rather than bring in more employees.
I predict a gun-manufacturing slowdown in 2010. So, hoard business cash and pay
down business debts. Plan on self financing during the coming lean times!"
Comment: America needs a strong, innovative arms industry. Without it, we'll be
unable to arm troops for the next war.
American gun and ammunition companies, be warned!
/John
