Gm..........rip

[zambuck]

GM is now gone..

Anyone here looking at charts and all sorts of analysis, ever saw this demise coming..?

Were there any indicators since 1999, which said that GM will be no more in 10 years time..?

The reason for this question is that a simple mechanic, who works in a Saab, actually predicted GM's demise long back....

Accoring to him, GM which owns Saab, was going downhill for a long time for various reasons.....

• In 1999, GM acquired the gigantic Hummer brand. Only one Hummer was sold in UK apparently
• Toyota also started selling its electric-hybrid Prius in 1997, a decade before GM sold theirs.
• Heavy discounting aimed at maintaining the American public as customers led to sharp cuts in profits, which eventually losses. The company was last profitable in 2004.

For any company and it's charts may be an indicator, but it would appear that it is fundamentals only that may predict it's demise more accurately....

TA charts are just for a while to hop on and hop out.....But in a falling and dying entity, charts are useless without more research on fundamentals.

 

[rawrschach]

Think Like A Fundamentalist; Trade Like A Chartist: The fundamentals may drive a market and need to be understood, but if the chart is not bullish, why be bullish? Trade when the technicals and fundamentals, as you understand them, run in concert, one with the other. - Gartman

 

[zambuck]

....Thanks..

...I raised a question to open up a discussion between TA and FA...

....It does appear that TA affecinados actually 'spit' at FA with a line 'Well when FA's are barging ahead, making the price change, is the time TA would hop on or hop out.....

That seems to be a typical TA approach....

....What I am saying is that surely TA decisions should be based on FA. There are several TA indicators like MA, Aroon, RSI etc etc....

Are there any 'idicators' that show these kind of issues that affect a trading decision more accurately...

Are there any indicators that show, like a chart, what positions these kind of fundamentals are...??....

...How many TA's actually use FA as a chart....?

Should chart show - as an example- PE, MD's standing - Is he dynamic..?...IS he a laggard..?...What value must be given to him..?, GM's business decisions....Are they competing with others..?...Or are they just rolling out labels..??, Bond holders position...Bondholders do not want to end up owning extra shares which have little or no value....etc etc...?

 

[N Rothschild]

We Are In Looneyville - The Market Ticker

 

[MrGecko]

I'm going to write the bumpf now to save me some time tomorrow... I'll post the prices when I've got the trade on.

Short General Motors, Long Ford

The idea for this trade came from an article in this weeks economist I read yesterday. While the outlook for the Motor industry is pretty dire, I think there might be an opportunity here. The reasons:

*Both comapnies have subsidiaries that they are trying to flog off - General Motors owns Saab, and Ford owns Volvo. Comparing the two (Saab and Volvo), it is clear to see which company is going to be easier to sell. Saab hasn't had a profitable year since... well, ages. Volvo, while struggling, has kept its head above water in the past. So the outlook is better for Ford (solvent) selling Volvo than GM (distressed) selling Saab...

*Look at the brands that each company has:


While ford has



Now, several things to note here:

Firstly, all those brands that GM runds must eat up cash, and none of them stand out as first class opportunites (Vauxhall, for example, will lose out to the competition - Ford).

Secondly, GM makes cars that drink petrol and spew out greenhouse gases (Hummer, GMC etc). I reckon that Obama will pass some environmental legislation, in some form or another, that penalises C02 spewing cars (more accurately, their owners) in the form of tax. Even if he doesn't do this explicitly, my money is on him moving towards a "greener America", and the associated domino effect.

Ford, on the other hand, has got a nice little line in Hybrids (Fusion and Escape) and run-arounds (Fiesta, Ka) - along with family saloons (Focus, Mondeo). It also makes the best selling Pick up truck, its called a 150 or something. Recession or depression, those things will continue to sell.

*Of course, GM is closer to nationalisation than Ford is because GM has been bailed out, Ford has not. Ford also has one of the Best CEO's in the world, while it seems the GM management have c0cked it up pretty badly.

*European Sales: Fords are popular cars over here. Other european makers (specifically the germans) are at the higher end of the market - Audi, Mercedes, BMW, Porsche - as customers for these cars move down a bracket, the market for "middle of the road" cars increases. Ford is better placed to capitalise on this than GM (I've never seen half of GM's marques over here).

*Additionally, the Scandinavian G'ment has said it will offer support for carmakers as long as the cash is spent in Scandinavia - though neither Volvo or Saab actually make the cars there. So not of direct significance, but pertinent.

The two are closely correlated and equally volatile.

Fundamentally, Ford has marginally better figures than GM (EPS etc..).

Looks like the Pro's have been making money from this trade for a long time (look at a chart of F - GM)

Thats about it, a "brain dump" for the trade. Will update with prices on Monday.

posted 1st feb '09

 

[N Rothschild]

posted 1st feb '09

 

[MrGecko]

Don't make me laugh - why do you think I didn't copy and paste the other trades in?

 

[blancspa]

big idea, I thought they re dead since last year

 

[N Rothschild]

Don't make me laugh - why do you think I didn't copy and paste the other trades in?

 

[counter_violent]

GM is now gone..

Anyone here looking at charts and all sorts of analysis, ever saw this demise coming..?

Were there any indicators since 1999, which said that GM will be no more in 10 years time..?

The reason for this question is that a simple mechanic, who works in a Saab, actually predicted GM's demise long back....

Accoring to him, GM which owns Saab, was going downhill for a long time for various reasons.....

• In 1999, GM acquired the gigantic Hummer brand. Only one Hummer was sold in UK apparently
• Toyota also started selling its electric-hybrid Prius in 1997, a decade before GM sold theirs.
• Heavy discounting aimed at maintaining the American public as customers led to sharp cuts in profits, which eventually losses. The company was last profitable in 2004.

For any company and it's charts may be an indicator, but it would appear that it is fundamentals only that may predict it's demise more accurately....

TA charts are just for a while to hop on and hop out.....But in a falling and dying entity, charts are useless without more research on fundamentals.

The simple answer to this question lies in Strength and Weakness generally.

In the major bull of the last years...did G M lag behind or was it a leader ?
Comparative analysis is required, be it FA or TA it does not matter.
When a company is only treading water at best in boom years...then it follows that in bad times it will be one of the first potentially to go bump.