by Henry Oliner
Today DayJet suspended its operation out of Macon, claiming it could not get the operating capital it needed.
Bill Heard closed all nine of its dealerships, including 4 in the Metro Atlanta area, unable to get GMAC financing.
For sure there may have been other business problems for these two enterprises, but unless the current Wall Street credit crisis is resolved, you can expect to see many such businesses close.
There are two critical points we must understand.
1. This is not a bailout of failing institutions, it is a liquidity crisis caused by several problems in addition to irresponsible management. It is a perfect storm of faulty regulations, bank rules, monetary instability, a real estate collapse, and various forms of management incompetence and fraud.
2. This is the intersection of Wall Street and Main Street. It is not an us or them choice. Without the needed liquidity there will be endless DayJets and Bill Heards closing. Small business will not be able to maintain their operating lines of credit and unemployment will soar.
I share many of the concerns of excessive pay and these should be controlled where possible, but the effort to restore liquidity rapidly is paramount. Save the system now, weed out the wrong doers later.
And yes, this is important enough to suspend the campaign for a week. McCain is where he should be; Obama is not….. yet.