Tag: ford

  • Stock Market Rally

    Americans are addicted to bad news. So this may come as a surprise. There are stocks within the market that are on fire! I’ll give you one example from my portfolio.

    ford-rally

    In February, I took dividends from Honda Motor Company (a stock I’ve owned a long time, having a flat year) and invested those dividends in Ford Motor Company. For those who don’t know what that means, investing dividends means that I didn’t put any of my cash in from my accounts, this is money Honda “gave” me as my share in their profits. It wasn’t “real money” but untouchable income, “free money” to me in my IRA.

    I bought Ford stock at $1.92 per share on a hunch. (Remember, I was playing with dividends… just cash sitting in my account.) Zooming out on their 3 year history I could see that Ford is traditionally a $10 per share stock. And while they aren’t doing well in the U.S., their European line is doing fine. Since they have a lot less debt and cut deeper, not taking government bail out money, it was reasonable to assume that their sector (American auto maker) had dragged their stock down more than real losses.

    Look at March and to-date in April and you will see a massive rally. As of this moment, shares of Ford are trading at $5,98. That’s $4.06 more than I paid for them. Roughly 200% interest. Of course, looking at the chart you can see that I sold some shares at $4.24. Last week, I locked in some of those profits by selling enough shares to cover my original purchase. That means that I guaranteed that I wouldn’t lose any money on Ford… the balance of those shares becomes more free money. So, I took dividend money, which was free to me, and in less than 90 days was able to double it while still holding on to free shares in Ford.

    My point is not to make myself look like a genius. Though, right now, I’m feeling pretty good about this investment. Certainly, in the last 5-6 years I’ve made the exact opposite mistake. I invested a ton of my portfolio in Sirius Satellite Radio because they started putting free radios in every car being made, never thinking it was an overvalued stock. The iPod hit it big and Satellite radio became the 8 track player. Shares I bought at $7 and $10 in the early 2000’s… I sold at $3 per share. (Currently trades at .43!) So you can see I am not a perfect investor.

    My point is that you can’t base how you feel about yourself on news reports. There’s a lot of talk about our nation being in a recession. Certainly, millions of people are out of work and we are facing a very real housing crisis. But, that doesn’t mean that everything in the world is bad and we should wallow in our depression! There is certainly lots and lots of money to be made. People on Wall Street are making BAGILLIONS of dollars right now while the rest of the nation thinks we are in a borderline depression. (The swine flu is also a great cover for this! Can you say, “distraction?”)

    Think of a recession as a shifting of how money is being spent. It’s not that people aren’t spending money. It’s not that there is less money in the marketplace. It’s that they aren’t spending it in places that we expect them to.

    How do I know what to look for?

    Companies are typically slow to react to that shifting. Ones who jumped the trend, even a little, will do well. Companies that tried to ride out the last few dollars on yesterday’s trend (Just look at every car General Motors had on their line in 2008… another example would be AOL/Time Warner) are going to get punished because they don’t have a product people will buy. You have to be like Warren Buffet. Before you invest in anything, see it. Do your research, read the reports… but that shouldn’t replace walking around a store… or in this case a car lot.

  • Things I’m thinking about today

    Ever just have a hodgepodge of slush in your mind? Here’s some random thoughts this morning.

    – While I still think of myself as a down-the-middle, maybe even conservative evangelical Christian… I’m finding myself tired of the grey haired leaders.

    – As much as I’d like to say I agree with the complimentarian position of women in ministry, I thinks it’s just a politically correct version of it’s older self. I think you can put me in the egalitarian position of women in ministry, if those are my choices. I think its straight up revisionism, chauvinism, and crazy hermeneutics to say women can’t be elders and pastors in churches. (Conservative brethren allow women to practically serve in these roles, they just call them “directors of ministry” and pay them 50% less. That’s sexism.)

    – Speaking of crazy hermeneutics… I think the rapture was made up by someone who liked science fiction. People argue about a pre-tribulational and post-tribulational rapture of God’s people in revelation. I keep reading the New Testement verses about that, and I have to say I think it was made up. I’m still firmly in the pre-millenial camp, but that whole rapture deal?

    – This year’s American Idol is ridiculous. Paula and that new lady are cheerleaders. Seriously, what is Paula on? Randy isn’t say “dog” nearly enough. And the longer this thing goes,  the more I like Simon. At least he tells the truth.

    – I’m officially addicted to the Travel Channel and the Discovery Channel. I could watch them both 24 hours a day.

    – I’m trying to be more green by taking the trolley to work in April. The mile walk back and forth to the trolley stop won’t hurt me either.

    – I can’t wait for it to warm up a bit more so I can swim at the Kroc Center.

    – The last month has been amazing on the stock market. Seriously, one of my stocks gain 25% just this week.

    – Call me a hypocrite. But I made $1 per share on Ford in the last 2 months. Easy money! I think GM is going out of business in the next 6 weeks. But Ford and Chrysler are going to make it.

    – I wanted to pull an April Fool’s joke on YS, I really did. But after I saw all the online jokes I was glad I didn’t.

    – Speaking of work… I’ve been wanting to run around screaming about how excited I am about new stuff we’re doing. But people there already think I’m nuts so I didn’t.

    – I like my iPhone, a lot.

    – The other day I had dinner with Gary Shell from our church in Romeo. He asked me if I had any regrets about this move. I feel bad about it but I laughed. No regrets. I’m not the kind of leader who second guesses himself much. But I do miss our friends, big time. We are trying to scrape together a plan to go to Detroit in July.

    – Baseball season is upon us, I’m calling it. Cubs win the World Series. 6 games.

    – The kids Spring Break begins today. I doubt we’ll make it through April without a trip to Disneyland.

    – When Jesus told his disciples, “Take up your cross and follow me” before the crucifixtion… what did they think? Is that kind of like U2’s new song, “Get on your boots?”

    – Stoney still hates the water. He’s the only labrador retreiver in the world who won’t swim.

  • How To Fix the Auto Industry: Federal Right to Work Laws

    This is my second idea: Pass a federal right to work law. (Idea #1)

    For anyone outside of the pretend world known as Detroit, this solution is a no-brainer. In order for Ford, GM, and Chrysler to move forward into the next 100 years of automaking they have to restructure how their labor is paid.

    One important element, the heaviest of them all, is to dump the UAW as the only labor force. With unemployment hovering near 10% in most of the Detroit area counties there is no better time to renegotiate with the unions. (In other words, if the unions refuse to comply simply replace those workers with unemployed people at new, lower wages.) Simply put, if the federal government is going to loan automakers $34 billion to get out of this mess, they should also pass a federal law making every shop in America an equal opportunity employer. As I wrote in January 2008, I think allowing employees to decide whether or not they will join a union is fair. But, today in America, in many states that choice is not allowed.

    More importantly, for the former Big 3 to survive they need to scale back wages to more reasonable levels across the board to compete on the open market.

    Yes, I am arguing that the Big 3 compensate their employees like other US-based automakers. Toyota, Honda, Nissan, and many other “Japanese” automakers pay their employees well, but still roughly half what the UAW demand as “fair.” And when the Big 3 made money hand over fist, who cared what they paid people? But if you’re going to mortgage our childrens future on bailing out these failed companies… let’s spend the American tax payers dollars wisely. Their pay should be based on what these other automakers pay their employees. Or perhaps, since this is federal money, they should be compensated like government employees?

    I’m not suggesting that we make unions illegal. I’m suggesting that it become illegal to force people to join them! Allow auto workers, state employees, teachers, and other unionized types of workers to chose for themselves if they want to be in a union or not. Isn’t that fair?

    It’s time to have all employees work together for the good of the Big 3. Again, if you haven’t been exposed to the auto industry you have no idea of some of the silliness. There are two separate classes of employees at an auto manufacturer. There is union labor and there is management labor. They have different pay structures, different disciplinary structures, different hiring practices, and even different parking areas! It’s time this all ended! We need the plant manager and the woman on the line to be on the same team. We need the executive and the janitor to have the same health care options, benefits structure, and vacation times. We need to completely kill the entitlement society that the unions create. No more 80% pay layoffs. No more pools of employees who get paid 100% of their salary to play cards. No more union stewards making what a plant manager makes. On and on.

    If Ford, GM, and Chrysler are going to take federal money it is time they started acting like 21st century companies. In other words, it is time the former Big 3 started acting like the companies who are kicking their butts.

    Learn more about the National Right to Work movement.

    Idea one: Change the car buying experience

    Idea two: Open the manufactoring to non-union employees

    Idea three: Coming soon…

  • How To Fix the Auto Industry: Get Rid of Dealerships

    Sometimes ideas are too simple to actually work. If the United States is going to give $34 billion to failing auto industry, I have a right to give my suggestions for how to fix things.

    In order to make it for the next 100 years you are going to have to radically innovate. It’s not going to be easy. It’s going to mean thinking about doing business differently than you ever have. To save the US Automakers, it’s going to mean sacrificing some of what has become sacred for the sake of making it work from here on out. Inside out top to bottom changes are what you need.

    This is my first idea:

    1. Starting immediately, your cars will only be purchased directly through you. No car buyer likes the dealership process so you need to kill fast Eddie’s business. You don’t buy a washing machine or a computer without knowing what the price really is, so why should you expect people to buy cars that way?

    2. Make car buying about the customer and not the dealer. This means you need to add a shopping cart, much like the one from Dell or Apple, to your website. For most buyers, getting a new car is either a very rare occurrence or they do it all the time. Make the website intuitive enough for the buyer to decide their buying experience. Instead of putting them on the defensive with a negotiation process that favors the professional, make the process about the buyer. The customer is your friend! Time to treat them that way.

    3. Have a simple pricing structure. Allow people to know how much the car costs you to produce. Then add a 5% profit and a 3% delivery free to that. Show the math. Allow customers to drill down into that invoice so they can see where every single part comes from and how much it costs. Not only will your prices be cheaper than the competition, your customers will know that they aren’t getting ripped off. All the shopping cart to add things one by one or by package. People are smart and they know what they like in a car… give them that ability.

    4. Eliminate the local finance office. This is the sleaziest part of the car buying experience. Allow people to buy the car through your finance company, or allow them to use a bank transfer, or even credit card to buy the car. Again, this is about giving your customer a fantastic buying experience instead of walking onto a dealer lot, with your brand on it, and getting screwed by someone representing you.

    5. Convert the local dealership into a delivery, customization, and repair shop. By getting rid of a sales and finance people will make the dealership more like the Apple Store. Change the name of these from dealerships to delivery locations. Instead of a sales force you will have genius’s and customer service agents.

    6. Only allow customers to come to the delivery center to buy accessories and receive customer care. Effective immediately, you will deliver the car where the customer wants it. Want a test drive, you can arrange to meet them somewhere. When it needs service, you’ll pick up the car free of charge.

    7. Every part of your cost should become open. This is about trust. You can make your money. Just be open about it. Customers will reward you for it.

    8. Allow customers to sell their used cars on your website. Have the local delivery office come to the customers house, create a listing, apply the proceeds to a future sale.

    9. No one in the sales, marketing, delivery process will be commissioned. Pay the people at the delivery centers well, but don’t overpay them. You want these people doing this job for love. A lot of people need jobs. If people at the new delivery centers quit… they will be easily replaced.

  • Don’t Bail Out US Automakers

    All of a sudden, the czar’s of the old guard Big 3 are interested in Washington again. (By Big 3 I mean Ford, GM, and Chrysler, not the real big 3 of Toyota, Honda, and Ford.) The news is full of stories of their CEO’s begging for federal bailout money to keep afloat. I can hear the words from here, “We only want $25 billion.” They probably each took their own corporate jets over there and are staying at $10,000 per night suites.

    Here’s why giving the Big 3 $25 billion is a bad idea:

    #1 Their problem isn’t bad loans, it’s bad labor contracts. I lived in Detroit for 5 years and I was totally sickened by labor practices. Over the last few generations an entitlement attitude has run rampant among workers. In short, until they can clean house and only keep the best workers regardless of union status or seniority any bailout will just be wasted on pouring more money into a broken vessel. Most people don’t know this, but they pay people not to work! They want federal dollars to keep paying people not to work! For $25 billion we need a federal right to work law. People should have a choice whether to join a union or not. Closed shops should be outlawed in every state… especially Michigan. Face a fact… unions were great at one point, but have helped bankrupt the auto industry.

    #2 Their problem isn’t bad loans, it’s over-generous retirement plans. In the last few year’s they have gotten wise and started buying people out. But the Big 3 are levied with a tax their competitors don’t pay… pensions. (Most have been structured on 401k plans since day one.) Until they can shed those pension problems the federal government shouldn’t give them a dime. I don’t think that they should just fore go the pensions. I think, once and for all, they should sell those debts off and let someone try to make a buck on distributing those dollars.

    #3 Their problem isn’t bad loans, it’s trying to sell cars people don’t want. Have you walked on a car lot lately? The Chrysler cars mostly look like space ships. The Ford ones look like Tonka trucks. The GM ones look like cars from the 1980s. I know that’s judgmental and I’m uneducated. But I was recently looking to buy a new car and literally laughed on most of the “U.S. Automaker” lots. For 20+ years they have whined about “foreign cars” on their market. The reason people aren’t buying them isn’t because they hate America, it’s because Honda, Nissan, Toyota, Volkswagen, and the rest are selling cars people want to drive.

    I have no doubt that the auto industry will get bailed out. They will become federally subsidized, just like the airline and farming industries. If it’s not the $25 billion today it’ll be $100 billion next week. My only hope is that in getting the money they will start to repair the damage.

    Meanwhile, I hope Michigan continues to look for a new economy. I hope they invest in the health care industry, technology, and financial industry. Michigan is full of amazingly brilliant people who want to succeed. Let’s hope that they get it sorted out soon!

  • 10 random Monday thoughts

    It’s a holiday. And a holiday for me means that I tend to get strikingly little done. I may have some big plans for my day… but if I get 1-2 things actually done I’ll be satisfied. Here’s just a data dump of things on my mind.

    1. I’m definitely taking a bike ride today.
    2. It was supposed to rain today, but looking at the satellite I don’t think that’s likely.
    3. I stayed up until 2 AM playing Madden 08 for the Wii. It’s just OK.
    4. This morning I added a ton of people to my friends list on Facebook. Many of them I don’t know personally but are “fans” of YMX on Facebook.
    5. It was fun to head out to Metemora State Park last night to hang with the Fisher’s and Brinker’s. Each time we come home Kristen and I vow to take our kids camping. I don’t really know if that will happen or not. But I hope it will
    6. Everyone is asking us when our house will go on the market. Probably in a few weeks. We have some things we need to do first. We are oddly at peace about the process. We know it’s a good house and are hopeful it will sell at a good price. 
    7. Jimmy was clutch yesterday. I was very pleased with the services over all. I especially liked that he “de-cheesed” the Lee Greenwood song, “God Bless the U.S.A.” 
    8. It was a little weird being my “last day” at Romeo. At the same time, we’re back next week. It’s not like we’re moving right now. The most common question yesterday was, “When do you start your new job?” I start next week and my next trip out west in in a couple weeks. 
    9. I’m shopping for a digital SLR as my wife has broken both our cameras. How do you decide between Nikon and Canon?
    10. Mellen’s Market (the corner store across the street from us) is closing its doors and going out of business later this week. That’s a total bummer.
    11. Bonus random thought: Kristen and I are planning to sell our car and buy a new one when we get to San Diego. We are definitely looking for a small/tiny car that gets great mileage. (I may even get a scooter!) High on our list of cars to look into are the Prius and Civic Hybrid. (American cars) We are also considering some Korean made cars and Mexican cars made by Ford and GM. I just had to get that dig in since Romeo people still think that there is a delineation between “American cars” and “Foreign cars.” No one outside of Michigan has used terms like that since the 1980s… but you still hear and see it here on bumper stickers. Let’s translate that… by “foreign car” they really mean “non-union made car.”

  • Good news for Romeo

    The mood in town, economically, is horrid. Everyone makes it seem like we are in the great depression or something.

    Here’s a little reminder to the people of Romeo that things are still quite good. The Ford F-150, whose engine is made right here in town, is still the #1 selling vehicle in America.

    Story

    Sure, sales are down. And things may continue to slow down. But we’re still doing pretty good.