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Consumer Confidential: Small-car prices, Borders in trouble, the Google Effect

July 18, 2011 | 10:06 am

Carpic Here's your make-it-or-break-it Monday roundup of consumer news from around the Web:

--With the economy stuck in neutral, many people are thinking about downsizing their wheels. Is now the best time? Maybe not. Small-car prices, which have set record highs this year, are expected to come down this fall. Lower gas prices will make people comfortable driving something bigger. Honda and Toyota, which were hurt by the Japan earthquake, will crank up production of small cars. And Japan and Detroit will offer big discounts on smaller models as their lots fill up. The average new compact car, which cost a record $20,500 in June, should fall to about $19,300 by the end of the year. The average used compact car should fall from a record $11,300 to about $9,600 over the same time, according to figures compiled by the Kelley Blue Book auto pricing service. Small-car prices should start falling in September and accelerate through the end of the year.

--Borders may soon say bye-bye. The once-mighty bookstore chain is inching closer to liquidation after a bidding deadline passed on Sunday without offers that would keep the company in business. Bids for Borders were due at 5 p.m. Sunday ahead of a bankruptcy-court auction scheduled for Tuesday. Still, Borders is likely to entertain offers right up until the scheduled auction in the hopes a white knight will emerge to save the chain. By late Sunday, Borders reportedly was in discussions with Books-A-Million, a bookstore chain based in Alabama, on some kind of potential deal. But it remained unclear whether Books-A-Million would be in a position to save all of what remains of Borders, and fluid discussions were underway with other parties. The dearth of bids to keep the company running increases the odds that Borders, which employs nearly 11,000 people, will be sold to a group of liquidators this week, putting the chain out of business for good.

--Is Google eating away at our ability to remember things? A new set of studies in the journal Science suggests that people are increasingly relying on access to information -- say, a Google search -- rather than memorizing things. This so-called Google Effect could result in people becoming more forgetful because they don't exercise their memory muscles as often as in pre-Google days. And this, of course, can only mean ... um ... sorry, I forgot what I was going to say.

-- David Lazarus

Photo: If you're in the market for a smaller car, you should wait a bit. Credit: Reed Saxon/AP