Tragic. This is insane that they are letting go of 50% of their entire workforce.
In other news, all major stock indices are nearing record highs. The stock market used to be a dead on indicator of the economy. Doesn’t seem to be the case anymore, as there’s a major disconnect. What # are we at now? 40,000,000 unemployed?
This is gonna spread to all sectors. Management realized how little most of their staff actually does everyday. And the ones that are productive can do it from home. Bars and restaurants are closing all over. The Dow is ripping though so all is good. Money printer go brrrrrr. Get your gold silver and bitcoins while they’re still relatively cheap!
I wonder Berkshire Automotive would do it too.
It’s not 50% of their entire workforce. It’s 50% of the 7000 furloughed employees. I believe they had over 26000 workers, so it’s about a 13.5% RIF, which is actually less than I would have expected.
The reason for the layoffs is because they had to return the $77 million PPP they applied for.
They didn’t have to they chose to after bad press due to the fact that they have almost half a billion in cash reserve yet chose to take the loan.
https://www.macrotrends.net/stocks/charts/AN/autonation/cash-on-hand
They actually had a very good month last month yet chose to do this anyway. Their stock has always been a bad performer anyway.
I read Mnuchin’s statement differently. It’s clear that a business must certify they need the PPP loan to continue operations and don’t have access to other lines of credit. Having half a billion cash in hand pretty clearly shows that Autonation could not certify that to be true. Treasury Secretary threatened “severe consequences” for companies that took loans and don’t meet the requirements unless they return the money. Based on these facts the return of the money seems involuntary.
Auto sales has a pretty high turn over rate. I wonder if they can avoid some layoffs just due to the normal attrition rate. My wild ass guess is the normal attrition rate is at least 5% per month for non-service dealership employees. This strategy obviously doesn’t work for white collar workforce at HQ.
You’re kidding right??? You mean to tell me they willing gave back 77 million in free money? This is autonation and the auto sales industry we re talking about. 
So are car sales booming or not?
But, but “inventory is so tight”!
And they just relaxed the rules around how the PPP loan can be used including not having to hire everyone back, so they could probably argue they would be eligible to keep themed funds.
Corporate takeover of America. V shaped recovery in the markets as small business gets annihilated. I’m starting to think universal basic income will become a reality a lot sooner then due to automation and robotics. This is going to be one of the biggest wealth transfers ever, and will lead to a couple triliionaires that made huge bets on wallstreet along with the FAANG oligarchs. Get ready for idiocracy. Welcome to Costco, I Iove you.
All these job losses and equites on wallstreet catapulting to nearly all time historical highs.
Or:
“We are about to see the best economic data we’ve seen in the history of this country,” he said.
DJIA up more than 700 pts. Job numbers through the roof…yet
The market is backed by the Fed. Low grade bonds are being bought. If you look at the Fed’s balance sheet, they’re also buying up individual stocks. This was not part of what happened in 2008. Powell has substantially expanded the Fed’s role in this crisis. They’re pumping trillions into the repo market. They kept the market from suffering a liquidity crisis because of too much bad debt.
So yeah, the market only represents how the top 15% or top 10% are doing.
The fed isn’t federal. Therefore those banking dynasties that own it just got even more powerful. You do not want to live in a world with deca-billionaires let alone trillionaires. That’s too much money for one person or small group with an agenda. Main Street is not a part of this rally I assure you that, especially as they watched the cities burn yesterday.