May 14th, 2009
01:10 PM ET

Financial Dispatch: Chrysler dealerships hit hard

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Gene Bloch
Managing Editor
CNN New York

The pain of Chrysler’s bankruptcy filing is hitting hard today – 789 Chrysler dealerships representing about 25% of the auto maker’s 3,181 dealerships – are getting word today they will be shut down. That means thousands of salespeople and staff out of work and a major impact on communities. General Motors is expected to soon announce an even bigger number of closures, as it heads toward a June 1st deadline to restructure with or without a Chapter 11 filing.

Most analysts expect GM will have to file as well.

Ahead of the Chrysler news this morning, more signs that the jobs picture is worsening, even as some signs on the economy are positive, or at least showing a slower pace of deterioration. A record 6.5 million people are now collecting unemployment claims, and the number of first time filers jumped last week by 32-thousand to a total of 637-thousand.

Inflation at the wholesale level jumped a bigger than expected 0.3% in April, but the year-over-year change in the Producer Price Index was DOWN 3.7%, which is the biggest decline since 1950, as a weak economy means prices must be cut to entice retailers to buy.

President Obama, as I write this is making a push at a high school town hall event in New Mexico the credit card legislation making its way through Congress – Mr. Obama has railed against hidden fees and sudden interest rate hikes that have many Americans outraged.

Drivers are being hit hard once again. Gas prices continue their upward March as AAA reports the average price for regular unleaded gasoline is $2.28 a gallon, up 1.4 cents on the day, and up 23 cents in the last 16 days. The recent run-up in oil prices has been driving that increase.

In today’s Energy Fix: How ‘green’ are your favorite gadgets? Face it, we’re addicted to gadgets. Many of us have a tv (or 2 or 3), computer, iPod, cell phone, Blackberry, etc. But as the popularity of those items grows, so does the amount of energy we use. A new report from the IEA says that energy used by household electronic devices could triple by 2030… possibly requiring hundreds of nuclear plants to be built to power those items.

And tonight at 8p, a special prime time Money Summit – this one under the Money & Main Street banner – an up-close look at how some Americans are fighting back by starting new businesses because the old one has shut down. Anderson Cooper and Ali Velshi host, and the expert panel includes Christine Romans, David Gergen, Donna Rosato of Money Magazine, and Katie Benner of Fortune.

Filed under: 360° Radar • CNN Money Summit • Economy • Energy • Finance • Gene Bloch • Unemployment
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