Asian-based asset management firm, Sun Worldwide, believe that US unemployment could skyrocket after the bailout of the Big Three US automakers was rejected by the Senate.
Sources close to Sun Worldwide suggest that the news could see stock markets around the world deteriorate into the new year, dashing hopes of a so-called “Santa rally”.
Sun Worldwide pointed to the US Dollar’s dismal showing against the Japanese Yen and other currencies and commodities as evidence of investors’ bleak expectations for the US economy. The only glimmer of hope for GM, Chrysler and Ford lies in some form of legislation to allow them to access funds from the $700bn TARP (Troubled Asset Relief Program) which was set up to rescue the US financial system from collapse.
One of the unnamed Sun Worldwide sources said that the main problem seems to lie in the speed at which unionized autoworkers should see a reduction in wages to bring them into line with their counterparts at foreign-owned carmakers in the US such as Toyota.
