How Bad is it? "GM is Worthless" bad, according to Deutsche.

Replies to This Discussion

Permalink Reply by StephenBln on November 10, 2008 at 20:09

We are witnessing the sinking of the good ships Reaganomics and Thatcherism.. But the politicians are too afraid to say so.. The anglo-saxon way of doing things on the financial markets has hit the fan..

• ▶ Reply

Permalink Reply by Clive Carter on November 10, 2008 at 23:20

AGREE with what you say, but the particular demise of GM (and possibly Ford and Chrysler) is no more evidence of the sinking of these questionable ships than is a company like Apple – with no debt and $25 billion cash in the bank –evidence that the Anglo-Saxon way of doing things has not hit the fan.

The writing has been on the wall for the big US carmakers for many years. They've had many chances to build sensible cars, but with the least fall in the oil price they're back to building huge gas guzzlers like SUVs and big pick-ups. They deserve their long-run fate because they've invested in it in the short term.

And the Obama administration is considering a bail out of the US automakers. Why should that industry be deserving of tax-payer help more than other manufacturers, who might be more deserving and whose products might actually be selling?

Was it not Mrs Thatcher who said you can't buck the markets? I'm glad she is still around to see the financial impact of unbridled free-markets.

We've got to get away from short-termism, which I see as the root cause of much of the current grief, whether its bankers focussing on a bonus for the current year or US corporations focussing on quarterly earnings.

• ▶ Reply

Permalink Reply by John McMullan on November 11, 2008 at 21:33

I worked with a Turkish/German trader a few years ago who thought his goose was cooked on General Motors going bust. We will see...

• ▶ Reply