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I just bought some Ford stock today with the hope it will go over 2 for a day or two after they announce the bail-out. All the talk will not keep the government from bailing out the companies that employ 1% of the American population, and the stock will have to rebound a bit. Ford sucks, but for ~$1.35 a share, how can you lose? Buy 100, 1000 or even 10,000 shares and you don't have too much to risk there, and a 25 cent uptick can bring enormous profit.
I think you're mistaken on several counts. For one thing, you can certainly lose, up to $1.35 per share. If a 25 cent uptick is enormous profit, then I would guess a 25 cent downtick is an enormous loss. At $1.21 you're halfway there already.
For another, the govt. can and probably will choose not to bail them out, if they think there is no reasonable chance at ultimate survival and the bailout is just throwing $25 billion down a rat hole to buy the execs six more months to find their own exit. At the rate GM is burning cash they'll chew threw the bailout in six months and then what? It takes years to get new lines of more efficient and competitive models to market and nobody sees the recession ending in less than a year.
They can choose to let the auto makers go the bankruptcy route, the only real route that breaks the unions and provides an ultimate solution. Bankruptcy doesn't mean they stop making cars, employing that 1%, or utilizing parts suppliers. The creditors will continue doing business with the auto makers although perhaps on stricter payment terms.
What you are seeing here is auto execs licking their chops as a result of all the bailout money that has been tossed around. Before the September financial bailout, nobody in the auto industry was expecting or asking for one.
For another, the govt. can and probably will choose not to bail them out,
If this congress doesn't the next one sure will ! Obama the savior has already made statement that everything will be done to help the Auto industry "at any cost", I do believe were his words. It is his number 1 priority after taking office. Said that in his interview that aired last Sun.
Expect some political rhetoric throughout the process (business as usual) but one way or another the Gov is going to spend more doe. And it isn't going to stop at the auto industry either. US auto is just a piece of the puzzle yet to come...
The point is to save the Automobile Industry, the institutional bond holders and, the owners of prefered stock. The holdings of the small inverstor are expendable in this game.
If this congress doesn't the next one sure will ! Obama the savior has already made statement that everything will be done to help the Auto industry "at any cost", I do believe were his words. It is his number 1 priority after taking office. Said that in his interview that aired last Sun.
GM might not make it to end of January. In any event, the President doesn't have authority to make the decision, he can lobby Congress if he wants but the current Congress is majority Democrat and they aren't too interested in passing a bailout. The Dems just canceled a vote today.
GM might not make it to end of January. In any event, the President doesn't have authority to make the decision, he can lobby Congress if he wants but the current Congress is majority Democrat and they aren't too interested in passing a bailout. The Dems just canceled a vote today.
They canceled the vote on using TARP funds. They are going to pull funds from the already allocated Energy Improvement funds. And that was just approved !
I agree with you leftydan. I picked up some C today at $6.63. I know it is risky, but there is no sensible reason for the stock to drop $2 bucks a share today. I have no doubt in a few days it will be back around $8 bucks a share.
God, I hope you got out of that. Blood on the streets. Good luck trying to catch a falling knife, though I reckon the stock is about due for a short squeeze. Personally I wouldn't go near it. It's reminiscent of Fannie and Freddie at this point. No doubt some traders made some quick money when those stocks rallied, but look where they are now. I'll stick with safer, no brain trades thank you.
They canceled the vote on using TARP funds. They are going to pull funds from the already allocated Energy Improvement funds. And that was just approved !
One of us has a misunderstanding. Mu understanding is the administration has told Congress they cannot use the bailout money for the financial companies on the auto companies and recommended Congress use the $25 bil for energy efficiency. But Dems in Congress are reluctant to use that money without a guarantee that the energy efficiency fund will be fully funded later. The decision to use it has not yet been made.
Congress told the automakers to come back in a few weeks with a detailed plan to show that the bailout will work. "Until they show us the plan we cannot show them the money," said Rep. Nancy Pelosi on Thursday. There has been no decision as far as I know to pull any funds to bail them out of short term cash flow problems.
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"The outgoing Bush administration criticized the congressional delay, saying lawmakers should consider a plan to let the automakers tap a separate $25 billion loan program for fuel-efficient cars for their short-term cash needs."
"Supporters of a bipartisan agreement to temporarily divert the fuel-efficiency funds to cover the auto companies' operations said they were hopeful to win support in December. "We need speed. This is a very, very important moment," said Sen. Carl Levin, D-Mich."
Detroit's Big 3 Have 2 Weeks to Win Congress Over - FOXBusiness.com (http://www.foxbusiness.com/story/markets/industries/government/detroits-big---weeks-win-congress/ - broken link)
One of us has a misunderstanding. Mu understanding is the administration has told Congress they cannot use the bailout money for the financial companies on the auto companies and recommended Congress use the $25 bil for energy efficiency. But Dems in Congress are reluctant to use that money without a guarantee that the energy efficiency fund will be fully funded later. The decision to use it has not yet been made.
Congress told the automakers to come back in a few weeks with a detailed plan to show that the bailout will work. "Until they show us the plan we cannot show them the money," said Rep. Nancy Pelosi on Thursday. There has been no decision as far as I know to pull any funds to bail them out of short term cash flow problems.
--------------
"The outgoing Bush administration criticized the congressional delay, saying lawmakers should consider a plan to let the automakers tap a separate $25 billion loan program for fuel-efficient cars for their short-term cash needs."
"Supporters of a bipartisan agreement to temporarily divert the fuel-efficiency funds to cover the auto companies' operations said they were hopeful to win support in December. "We need speed. This is a very, very important moment," said Sen. Carl Levin, D-Mich."
Detroit's Big 3 Have 2 Weeks to Win Congress Over - FOXBusiness.com (http://www.foxbusiness.com/story/markets/industries/government/detroits-big---weeks-win-congress/ - broken link)
Yesterday was a screwy day. At one point it hit the wire and new desks that Congress had passed a nugget from the energy fund and an hour later they made a statement that they declined it and want further info on their plans. Which is fine with me and everyone I think.
It was quite a sight to see the games live. It kind of makes me wonder if it was just a mistaken news reporter (which I doubt) or if someone in Congress slipped something out for some particular reason... Did you see the market reaction to that approved news wire ???? Sort of indicates to me that the markets very much value US Auto. Dow went from ~-200 to ~+200 in minutes. And just after the press released that congress changed their mind... well you see the finish.
Amidst all the other bad news that was affecting the markets yesterday the ruling on US auto had a huge affect all it's own ! Somebody wanted to see something with all the game playing...
I have a lot of shares in Ford and I am wondering what happens to my stock if the government does a bailout for them. I am not sure what the plans are for the bailout, but as long as it is not a bankruptcy, is my stock still my stock?
Please explain how F is worf nuffing as you so elegantly put it in your empty statement ?
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