I Would Wear A Helmet With Three Horns
First, a correction: SINO (Sino-Global Shipping), which I covered a few days ago, has significantly more shares outstanding than I initially believed. I’d like to revise my targets from $12 to about $7, or $8 if you are feeling more aggressive. Since SINO dropped 10% today to $13, I hope no one bought in at $14.
Second: man, are the US auto makers screwed. This might seem obvious, of course, but why don’t I add a little detail to the pornography.
A carmaker, generically, makes cars and/or trucks. The US automaker has a business model (all three use the same model): sell cars for little to no profit and sell trucks for big money. See, those crazy import companies, they price their cars so cheap the good patriotic American companies can’t really get a good profit in the car market. They could have tried something radical like justifying a higher price by creating a better product, but that’s one of them dangerous communists would do.
Better dead than red, I say.
Anyway, the US makes elected to essentially tread water in the car market while exploiting the truck market for big margins. Think it costs GM/Ford/Chrysler much more to make a pickup truck (think Ram/F-series/etc) than a car?
Shiiit son. Heck, naw. Hell, they be easier to build, don’t take much extra metal, and aren’t legally required to do so good on all that fuel efficiency, e-missions, and safety bull crap. All you’s gotsta do is take a big shitty metal box, slap some gaudy pastic moulding on the sides, drop in the biggest, baddest, loudest engine built on 1960’s technology you can find, then mark up the cost so high it makes every chaw dippin’ roper dump a spittoon on his head tryin to get one.
Or you can close up the back of the pick up, bolt in some extree seats, and make sure the dern thing be so big that it’ll crush any car (and associated fellers inside) that it happens to run into. Then mark the pricer up even higher and you’ll make every broad with a pack of brat-devils soak their panties with lust.
Shucks, and everybody knows only a real ‘Merican can build a truck. Can’t trust them foreigners to do it right, ya hear?
Yee haw! Boy howdy!
‘Course, now-a-days don’t no one want a pickem up truck. That’s a problem. A conversation with one of my stalwart coworkers, late of Detroit:
Coworker: “What’s it going to take to turn this thing around?”
Me: “A lot of pain.”
CW: “Think they’ll have to break free of the unions?”
Me: “Sure wouldn’t hurt.”
So, sorry to anyone that is in or related to an auto workers union, but the unions are part of the problem now. I’d say about 40% of the problem, with the other 60% going to past and present strategic management of the US auto companies.
I understand all the great things unions brought to the labor scene. As a supporter of the free market, I identify the labor unions as one of the great achievements of the development of the western market economy. The fact of the matter is that without the US government, the auto union would fail because the big three would drop all the union workers like a rock, and that for years now the unions have stifled competitive innovation and economic growth in the US auto scene in particular and the Midwestern economy in general.
I enter into evidence the state of Michigan.
I digress. Just don’t look to the auto industry to save us.
Bernanke and Fed are now more worried about inflation, suggest more rate cuts are not forthcoming. This gives the purchasing power of the dollar a little bump, making imported items a little cheaper.
The essential story of the day, however, was more fretting and hand wringing about the health of financial institutions. Today it was Lehman’s at center stage, but it could be a different bank tomorrow. Never know these days.
Still a good read: day 2 of visiting the Nordic education system.
Also, the primary season sort of ends tonight with the voting in ethnically diverse Montana and South Dakota. Regardless of the outcome, the AP reports that Obama has won the necessary number of delegates for the nomination.
I’ve got your value right here,
The great Rafael Nadal
