Feelings about GM

What kind of research? Maybe one of us can point you to exactly what you're curious about.

If you had trouble finding previous long debates about GM, just go to the Main Forum and, working backward from the first page, look for a thread called "Smoke and Mirrors", which malorn started. Before you get that far you'll run across another, more recent one, also malorn's, with the SUB-heading "Smoke and Mirrors II" (can't remember the actual thread name). Reading those will take you a couple of hours. They're all about GM.

Are you a senior in high school? Got your own offroad truck, huh? Is your truck what got you into GM Insider?

 

"The majority of products GM is coming out with right now trump anything Toyota offers, especially on a price-benefit level."


Dream on, how many decades have we heard this drivel?

GM's market share has dropped steadily since about 1970, and every year some GM exec says THIS is the year it all changes. And of course, nothing changes.

GM is losing money making cars. Billions.

GM is dropping prices across the board this year.

GM's stock and bond ratings are junk.

GM is heading toward BK faster than a rebound.

So you can let the air out of your phony chest and face reality

I hope they will remain in business, but the changes they need are still not forthcoming. They need to close plants, renegotiate contracts, drop brands. They have a long way to go. I hope they wise up before they reach the point of no return and liquidation. I want them to succeed, but I just don't see it yet.

 

That strategy is okay when dealing with "play" money (i.e., disposable income). Hoping to make a killing, taking big risks using past-based thinking and, let's face it, fantasy.

But I don't use play money or make investment decisions purely based on numbers or even the public history of the company. I look at the way the company is managed, analyze its annual reports, try to find out as much as I can about the culture of the company, its attitude towards its stockholders and how it interacts with its markets. I also look at how those markets are developing and how they dance with the US government and, often, on the international level (weather and climate changes, conflicts and wars, gang activity, CDC and WHO disease reports, etc.)

I'm investing my retirement monies and can't afford many mistakes. When I chose to purchase a company's stocks, I'm investing in the company and its market. Here's how I look at it: when I buy stocks in an American company, I'm investing in a piece of the country's economy.

My latest baby went up 37% in the past six months.
Husband Dan wants me to make all our investment decisions. His portfolio went up 9% last year. Mine went up 22%, mostly because it's much smaller than his.
I figured the military and homeland security would be promoting lab research. I used to work in labs and used a particular company which sold a line of proprietary lab equipment, equipment that needs maintenance supplies. Those supplies can only be purchased from the manufacturer. Took $20,000, plopped it into the company and eeyhaw!
Great fun but the trick is not falling in love with a stock, to have predetermined sell points.

Here's my latest news catcher: bird flu.
It's been reported in Europe (Greece, Romania) and recently killed additional people in Turkey, Thailand, and China.
My stock broker is, like me, a former nurse. She's researching to determine who makes respirators and the parts for them. Could be just one or two manufacturers. I'm researching masks and other disposable medical supplies. We figure hospitals and individuals will be stockpiling such things and the market is going to boom.

By the way, I realize if a H5N1 + human flu virus develops and results in a pandemic, it won't matter how much money I or anyone else makes in the stock market. Chances are I'll be dead.
Although I live in a small town, we're on the major travel artery between DC, Philly, New York, and Baltimore. Unless the local authorities are prepared and willing to make hard choices, our little hamlet's hospital will be hit hard and the town's infrastructure will fall apart. I don't see my local leaders as capable of averting or handling chaos.

 

Hardly. My stock broker isn't into the sexy stock-of-the-moment. We discuss how to invest in American businesses, which way we think the world economy is going, political climes, etc. I can't afford to play with my retirement investments so no, nothing as speculative as Google. I'm in it for the long haul.

GM might manage to survive as a company but its stock is speculative, risky, crap.

 

Remember Chrysler years ago? The government stepped in and helped them out so they wouldn't go under. Then they ended up merging with Daimler (who got the short end of that stick?) I can't believe that they would let GM disappear. Its seems that it is far too large a company. Bigger than Chrysler was at the time. GM has some lines now with some good selling products after many years of offering really poor models. The cadillac line seems to be doing good with most of their models, and a new Escalade is due out in the Spring, and can't forget about the Corvette which seems to have morphed into a pretty legitimate sportscar. The pontiac solstance is also a pretty impressive care for the money. The rest of the line up is still pretty sad, but turning something like this around I would think is not so easy. I don't think the stock is going anywhere for a while, but I also don't think the company is going to disappear either. Just my 2 cents.

 

No one expects GM to disappear. It's simply a matter of looking at the trend and drawing some conclusions. The trend for GM is weakness in everything except trucks and the conclusion is "they're in a world of hurt." That seems clear enough to me.

GM will indeed wind up a much smaller company. They'll either be a restructured, focused, improved company *or* they'll be a re-organized-under-Chapter-11, hanging on by their truck business, slowly wasting away company.

Stay tuned for the exciting conclusion. Just don't hold your breath.

 

What's sad is that GM's retirees and current employees will be screwed. Their health plans and retirement funds are headed West, adios.

GM's past managers and the greedy, foolish union leaders should be strung up. The stock holders and retirees can draw straws to see who gets to kick the stools out from under the crooks.

 

Some of you don't realize what kind a blow a Ford and GM BK would be to the economy. The fallout after such a disaster would send the world economy into a tailspin which would dwarf the great depression.

GM will come storming back. I am amazed by all this idle talk about BK. If they lost money at the rate they did last year they have enough cash to hold on for 6 + years. do you really expect them to keep losing that kind of money. The recent consessions from the UAW will save 3 billion a year.

 

Aside from health issues, this is probably the WORST thing that can happen to someone.
It's one thing to lose your retirement funds when you're 32, it's a whole different story when you're 65, and don't even get the chance to build something back up.

:angry:

 

Bankruptcy by GM is not 'idle talk'. It will happen. Bankruptcy is just another business strategy these days, and after United et al used it to shitcan their pension expenses to the American taxpayer's pocketbook, the rest of the big, pension heavy corporations 'can't afford not to' do the same. I imagine their boards will be under pressure to weasel out from under their obligations to their long-time employees (you know them, the ones who made the once-great companies great in the first place).

 

Accounting is a complicated thing, as many of the wall streeters who touted Enron until BK might well tell you. And for those with conflicts of interest -- well, let me just say their opinions are .. amusing.

So fwiw, my reading of the GM money sheet:
The companies net worth is *negative*
Profits are nowhere in sight
Cash reserves are about 16B, down from 30B (!) not too long ago. Red line reserves to function on a day-to-day basis are reportedly 10B, and GM has a 6B obligation it will owe if it's parts supplier folds.
Market share is going down, and there is no sign of let-up, let alone turnaround
GMAC has been the company's lifeline, but with decreasing bond status that is unlikely to continue.

BK, gov bailout, and pension/benefit defaults strike me as self-evident.

Malorn, are you buying GM stock these days ?

 

Yes I am.

 

Oh, Malorn!

I hope you are using "play" (disposable) money that you can afford to lose.

Now is not the time to buy GM stock. Matter of fact, it can be argued that the entire market is over-valued. But that's a whole other discussion.

 

I agree with you about the market(how about google and the like), but I disagree with you about GM. I think GM is beginning a resurgence.

 

I guess you're putting your money where your mouth is but I hope not the lion's share.

Do you at least have a pre-planned "sell" point? How often are you planning to check the stock prices? And have you read the annual report and the recent 10Ks and 10Qs?

 

Ballpark, how much ?

 

1% of my gross income every month for the past 16 months. I have also put 1/3 of the last company dividend into GM stock.

 

Very good Spunky, very good....


h34r:

 

Now you know why Dan married me.

He was very impressed by my latest stock pick. It went up 37% in six months*.

He's spoiled. It's not enough that I make his coffee every morning with freshly ground beans or the best soups, stews, chillis, chocolate puddings and cookies, or roast chicken he's ever had (so he says), now he wants me to grow our investment monies over 20% each year. Hah!

*They make medical devices, own the patents on and produce the latest mammography equipment.