Markets

You cannot discount the opinions of Abby Joseph Cohen at Goldman. She may be the only woman on Wall Street who actually got her job because of her ability and not on some feminist bean counting. She has stated that while the bottom is not exactly in, the economy is so strong that this market will snap back and is under valued at current prices. The market will snap back a great deal today but it ain't over til it's over. She thinks 1600 S&P is real value. Far be it for me to challenge her nearly unblemished track record, she was wrong one time ('01) and that makes her even better in my book. What about sub prime? The spread between the sub prime and prime was way out of whack and has now corrected. We will see what we will see. My opinion: the current rally is what is called a "short covering" rally, which means the shorts have made a killing and are now buying back their positions. Ya gotta wait several days for this to really shape up.

GENERAL MOTORS: my criticism of the company has been that they have ignored the track record of the kids who have been building hot rods from the bottom up since 1950. Those kids have been ahead of Detroit on all levels for fifty years. Similarly the Italian designs made us look sick for at least forty years. The suits were all incompetents who went to GM approved colleges and had no love for cars; none of them had ever been the build your own car kids. All were in the money making business and not the car business. Well, that was before Bob Lutz, the current top dog at GM came onto the scene. He is a car maniac. He has a huge collection of classic cars and knows classic design. GM is beginning to show what he is made of. Ford? Total assholes, and proving it every day. But GM is still stuck with the UAW and may have to go bankrupt in order to survive. Autoblogger has a good piece about the huge surplus of dealers burdening all companies and dragging at any profits. Companies can't dump dealers due to local laws protecting them.