What the heck is going on with General Motors?

[Felonious Monk/Fignozzle]

So conceivably, it would be a good move to do a put option on Diebold...if, unlike me, you really HAD a clue about the whole options thing.

[mfree]

Hrmm. Maybe GM brass needs to read a little Edwards Dimming.

[The Rabbi]

So conceivably, it would be a good move to do a put option on Diebold...if, unlike me, you really HAD a clue about the whole options thing.

I know plenty about options, acquired at private school rates.
I do not see Diebold as a good short.  That would mean shorting the dividend as well and that isnt my style.
I also dont like the options scene.  The company is already trading at the low end of 52 week prices.  They have little debt, lots of cash.  Maybe they have some problems in operations but I don't see this as a screaming sell.  I wouldnt buy it either.
Isn't Jim March involved in some kind of lawsuit against them?

[taliv]

while diebold's taking it up the bung on the electronic voting machine front, don't forget that they made most of the ATMs out there and i think they operate quite a few too.

it'd be easier to sell dbd short than to "do a put option" but if you've done neither before, plan on sitting this one out as it'll take you a couple days of paperwork to set up your margin account or sign the options agreement.

[Felonious Monk/Fignozzle]

taliv,  thanks for the advice.  I promise, I'm in NO shape at the moment to be rolling dice or doing anything speculative.  Just trying to observe & learn, and commenting along the way (which flushes out my ignorance, but growth only comes if you ask questions).

I already learned from Rabbi to watch the 52 week highs/lows from his previous post.  
I sure wish I knew at 20 what I'm learning now.

[Art Eatman]

Maybe GM oughta hire Lee Iacocca.

Remember, iacocca never had Chrysler actually take federal money.  The feds guaranteed the loans Chrysler got, but they were all paid back without taxpayer money coming into play.  Iacocca basically told the unions, "You can take a 30% cut in pay, or a 100% cut in pay."  For once, the UAW paid attention to reality.

But not even an Iacocca can deal with the fatal mix of GM's overly generous pension plan and the overly generous (read:  free) medical benefits that accompany the pension.

I've watched it for thirty years:  The more the feds have gotten involved in the world of medicine, the more medicine costs.  I'm so glad the feds are taking care of us!

, Art

[The Rabbi]

GM has enormous problems that go back a long way.  They are probably unsolvable in the current environment.  I suspect a bankruptcy for the company is coming this year, in part to pressure the unions to change.  The dividend will certainly be cut.

News this AM, GM has cut its dividend in half.

[Guest]

CEO's paycheck halved, too...

[The Rabbi]

Stock tip:

Sell Diebold.

There's a shareholder's conference and earnings call coming the 31st of Jan.  Predictions are uuuugly.  They're down a point and a half today alone, and this is after a good-sized crash about six-seven months ago that's led to a major stockholder's suit (actually several but they'll consolidate soon).

It's not just about the elections biz.  Debit card readers at grocery stores, gas stations and the like are slaughtering the ATM biz.

Jan 26 Diebold closed at $37.23.  The stock went up from there and closed today at $41.56.  Also paid a dividend on 3 Feb of 21.5 cents.  Anyone taking this advice would have lost about 10.49% or about 105% on an annualized basis.  Moral of the story: do your own due diligence.

[Werewolf]

GM has a number of problems:

High labor costs: Unions
High Pension costs: Unions
Piss poor quality compared to foreign made cars: Unions
Greedy Management: Took their que from the Unions
100 year history - they're old and don't think they need to keep up...

GM needs to just DIE!

Unfortunatel almost 30% of the US economy is tied either directly or indirectly to the Auto Industry and GM is a huge part of that. If GM goes down the US economy will take a huge, huge hit. Maybe one from which it cannot recover.

So as much as I'd like to see a few hundred thousand union scum get what's coming to 'em and a bunch of greedy corporate management types end up living on the streets it just would hurt the country too much to let 'em go down. The US government will end up bailin' 'em out just like they did with Chrysler.

[Antibubba]

It's gotten so bad they're changing their name to "Lieutenant Motors".


Standing Wolf-don't forget the Chinese.  They'll see that as the easiest way into the American Market.