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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: AC Flyer who wrote (21379)	7/17/2002 1:13:01 PM
From: LLCF	Read Replies (1) \| Respond to of 74559

<Then why didn't you say that, instead of pulling the "investing 101" crap. > Because it IS [cyclicals] 101... and the insinuation that I thought high and low PE's were bad because I was a fool wasn't exactly direct speak either. In any case, I can see that it was an uncalled for 'jab' on my part... so I am sorry about that. I believe we finished the biggest boom in US history a couple years ago, and now were a small way through the biggest bust... we've been discussing that on the thread for > a year, it is the backdrop for which I make my posts... sorry if that's confusing. <in which case I'll be waiting a long time to get my monopoly money back. > Most people will simply sell eventually as they get sick and tired of stocks doing nothing while the money in their MM accounts keep racking up gains month after month. Sort of the reverse of what happend until a couple years ago. DAK

To: AC Flyer who wrote (21379)	7/17/2002 1:55:08 PM
From: reaper	Read Replies (2) \| Respond to of 74559

<<instead of pulling the "investing 101" crap>> OK, then let's see how you do with Investing 201. (i) GM "earned" $1.5 billion in the quarter, yet their cash and their debt are basically unchanged. Where did the money go? (ii) GM generated $3.5 billion of cash from ops from their automotive division in the quarter (according to their press release). How much of this cash came from not paying their bills, and how much came from the actual operations of the company (i'll give you a hint: look in payables and accrueds)? (iii) how much of the real cash that GM generated (i.e. beyond not paying their bills) was spent on capital expenditures in the quarter? (iv) GM has $35.5 billion of lease assets on its balance sheet. what are management's assumptions regarding residual values on those leases? are your assumptions the same or different from management's? (v) GM has $106.8 billion of finance receivable assets on its balance sheet. what are management's assumptions regarding future charge-offs? are your assumptions the same or different? (vi) GM has $20.7 billion of book equity. how much downward adjustment to the assumptions referenced in (iv) and (v) above would be necessary for GM to become insolvent? (vii) what are GMs credit ratings, both at GM corporate and at GMAC? in which direction are these ratings heading? where are GM bonds trading, and what is their general trend? what does the direction of bond prices signal about equity prices? (viii) and finally.... do you always buy stock in companies where you so grossly mis-understand the financial statements, or is it just your patriotic duty to "buy American"? Cheers