Wow, a 31 year old is in charge of dismantling General Motors.  Really?  Really?

You need a little life and business experience to make these decisions.  Working on a campaign doesn’t exactly constitute that.  I don’t care how bright you are!

via The-31-Year-Old-in-Charge-of-Dismantling-G.M.: Personal Finance News from Yahoo! Finance.

Podcast episode 15.

Bob’s trading success continues. He is on a roll. Corning is his latest gain. Listen to the podcast and view recent successes on his trading page. It’s hard to dispute the results. Why does the Dow do what they do? Is the Dow an accurate measure of the economy. Speaking of the Dow, Bob and Scott discuss where the market started this January. Do you know where the market started in 2009? We were suprised to find out the answer.

Ford might be in a position to make hay in this market. However, they are suddenly competing against deep pockets, yours and mine. GM now has $50 billion in debtor in possession (DIP) financing to get them back on track.  Is it fair for Ford to compete against what has become a government owned entity.  Will the politicians be able to keep their hands off of things?  That part is highly unlikely.

Ford is in a unique position to find the best and brightest people (if the union allows it), produce products without the intervention/oversight of the government.  Ford will be increasing production this quarter.  However, they might not have the products to capture the imagination of the buying public.  I am in search of a truck.  I like the F150, but I am not sold on it (not sure why).  Will they have to incent me to the point that they put their own survival at risk?

How well will the new GM be run?  I don’t know about you, but whenever I am dealing with someone who isn’t spending their own money, or who is spending money of someone who is indifferent toward that company, they spend differently (foolishly).  I can’t imagine that GM is going to be operating well.  There is a TON of fat to trim.  Let’s hope that the new management of the company is willing to take the steps needed.

By the way, if you were still holding GM stock… what gives? Were you looking for a loss? This bankruptcy was one of the most obvious in quite some time. The day that they stated that BK was imminent, you should have run for the hills. Even if BK wasn’t going to happen, it was pretty clear that the common stock would be wiped out with a restructuring. It was mentioned on “The Bob and Scott Show” podcast many times. “COMMON WILL BE WIPED OUT”.

I have been a little perplexed at how stocks in companies who have essentially said that bankruptcy is imminent continue to trade at levels above a few pennies.

Is there hope that the common shareholders in GM will receive something in a bankruptcy or restructuring?  If so, what will a common shareholder receive?  Senior debt holders are getting well below face falue, subordinated debt…less.  Preferred shareholders?  Common?  Typically, common shareholders will be wiped out.  It is the first class that is wiped out when a company restructures.  Is this administration going to force something other than that?  If so, why?

I have seen common shares continue to trade leading up to a bankruptcy.  I would venture a guess that there is some financial reason for some to trade in those shares.  However, I often hear from inexperienced investors about how they are buying this because “it will come back” or “they heard a rumor”.  Not happening!  There was a case in my own back yard.  When Adelphia was heading toward bankruptcy court, the shares would continue to trade from $1 – $4.  There was much talk about why since it was local and I heard many more stories about how they were buying because “… the stock was at… a year ago”.

DO YOUR HOMEWORK BEFORE BUYING A STOCK.  Your friend who works on the line, or in the customer service unit, or at a supplier, is not ‘in the know’.

via GM Gets Concessions From CAW Before Probable Filing (Update1) – Bloomberg.com.

In this episode, Bob and Scott discuss the fate of the US car dealer, cover the AOL daily finance app, discuss a new entry in the search field… WolframAlpha.com