The Residential Real Estate Crash Index Message Board

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Strategies & Market Trends : The Residential Real Estate Crash Index

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To: Smiling Bob who wrote (150308)	9/25/2008 2:22:58 PM
From: XoFruitCake	Read Replies (1) of 306849

"I question the soundness of businesses that can't function without bank credit. Again, I'm not talking about companies in which money is their business. I'm considering retailers, manufacturers, transport, pharmaceutical, tech, service. If your cash flow alone isn't paying the bills on such a continual basis that you're regularly depending on loans to survive, then you're already on fragile ground." I thought there are a lot of industries that are seasonal in natural (e.g. Christmas selling.. vacation spots etc.) and other industries that has a gap between manufacturing cost vs collection of the payments... And even for retailer, they need to finance their inventory and may need to extend credit to their consumers. In a normal credit environment, they are o.k. but now they will be shutting down... I don't see that how this can be a good public policy (to let credit market die and let every business fend for themselves)... Even big retailer like Walmart, Target etc.. use short term facilities to finance their inventory.. I don't know many companies that can operate without access to commercial paper or short term loan facility..

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