Stocks drop as jobless claims rise unexpectedly

AP via Yahoo Finance ^ | 8/19/2010 | Stephen Bernard

[SonOfDarkSkies]

I just can't see how the deal can get done.

First, the market sux.

Second, investors aren't showing a lot of interest in GM specifically because...

• the economy is still performing poorly (Obama is a dark cloud on the horizon for all U.S. business),

• the Volt investment by GM is huge and no one knows if that's gonna work or be another Edsel,

• GM is now more linked to the UAW...how will that work out,

• the GM product lineup is old for the most part (have they retained the talented designers they need to churn out appealing new models), and

• investors (me at least) have no idea how GM's management is going to perform under Whitacre (And I think Whitacre lost of a lot of respect when he told that whopper about paying back the guvvie loan--probably at Obama's direction).

Bottom line, GM looks like a dud to me and I wouldn't put a dime into it...and I can't believe the rest of the world is so gullible to jump on the bandwagon.

[Qbert]

Yeah, could very well pan out that way.

“investors (me at least) have no idea how GM’s management is going to perform under Whitacre (And I think Whitacre lost of a lot of respect when he told that whopper about paying back the guvvie loan—probably at Obama’s direction).”

Even worse- he’s gone. And this oughta make people’s eyes bulge (from GM’s filings):

“We have elected a new Chief Executive Officer who will start on September 1, 2010 and a new Chief Financial Officer who started on January 1, 2010, both of whom have no outside automotive industry experience.”

Investors should seriously ponder that sentence if the IPO does go through.

A great article on the risks of GM’s IPO:

http://www.thetruthaboutcars.com/gms-s-1-ipo-filing-the-risks/

[SonOfDarkSkies]

Holy Cow!

What a weird upside down world this planet has become!

I just did a quick scan of the article you linked to...and it is bizarre.

GM has as much as admitted it has internal control problems in financial reporting such that even tests conducted to evaluate such controls were ineffective...

[B]ecause of the inability to sufficiently test the effectiveness of remediated internal controls, we concluded that our internal control over financial reporting was not effective. At June 30, 2010 we concluded that our disclosure controls and procedures were not effective at a reasonable assurance level because of the material weakness in our internal control over financial reporting that continued to exist.

Yep! Great time for an IPO!

[SonOfDarkSkies]

I am completely flummoxed!

Check this weird statement in the article to which you linked...

"GM also discloses that it will continue to be at least partially owned by the US Treasury after the IPO, and as a result..."

"[T]he UST is able to exercise significant influence over our business if it elects to do so...and it may influence...matters including:

• The selection, tenure and compensation of our management;

• Our business strategy and product offerings;

• Our relationship with our employees, unions and other constituencies; and

• Our financing activities, including the issuance of debt and equity securities."

This gives Obama control of the company even after it has gone public.

Yep, that seals the deal for me...I want to invest all my future in Obama Motors.

[Qbert]

Yeah, those do seem like some truly weird, non-boilerplate disclosures.

They admit that IC’s over financial reporting are materially flawed as of June 30, 2010, and yet they’re rushing this for an IPO by November? What the...?

It’s amazing what can be found “hidden in plain view” sometimes...

[Qbert]

Looks like even more questions are being raised about the faulty IC’s and the questionable financials:

“...Peter Flaherty at the National Legal & Policy Center notes GM couldn’t assure the accuracy of its financials in its 500-page filing because its internal controls remain weak. “How can GM offer and price shares if it cannot even attest to its own financials?” he asked.”

http://www.investors.com/NewsAndAnalysis/Article.aspx?id=544407&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:%20EditorialRss%20(Editorial%20RSS)&p=2