General Motors reported disappointing earnings yesterday and share price fell over 11% (compared to about 3% for broader markets) to $22 and change, down 33% from its IPO offering at $33 about a year ago. Taxpayers saw a paper loss of over $1 billion on their "investment" in just one day. Individual investors may have been confused by initial headlines that trumpeted an earnings beat by GM at the same time that pre-market share price signaled that the earnings report was a disappointment. Let's take a look at what drove the move as well as where GM may be heading.
On Monday NLPC’s Mark Modica smartly called into question Consumer Reports’ sudden change in opinion about the electric hybrid Chevy Volt from a vehicle that they once believed “doesn’t seem to make a lot of sense,” to one the publication recommends. The next day, however, CR delivered an online review of the major all-electric vehicle on the U.S. market – the Nissan Leaf – and while not intended to be scathing, the account given by reviewer Liza Barth makes the car sound so unappealing, she should have panned it outright.
General Motors has gotten much attention on its controversial Chevy Volt tax-subsidized vehicle. The hype for the Volt started over two years ago as GM was trying to put a positive face on the future green potential of a plug-in vehicle that was to be a game changer for the industry as Washington was lobbied for a taxpayer funded bailout. While the final verdict on the success of the Volt has not been reached, the initial performance is underwhelming; especially considering the amount of hype and marketing money (supplied by taxpayers) emanating from GM.
Meeks apparently had not yet received a copy of the Complaint at the time he wrote a column published last week in the Queens (New York) Tribune. In the column, Meeks characterized us as "right wing" and (again) blamed us for his ethics problems. I can't wait to see his reaction to our new Complaint.
Cars in Depth reports that the Chevy Volt and it's charging station are suspected as possible causes for a house fire that started in the garage of a Mooresville, NC home. According to the report, investigators found a Volt plugged into a charging station located in the burned out garage. The Iredell County Fire Marshal's office investigating the fire states, "The charging station was in the known area of origin, but the cause of the fire has not been officially determined."
Back in April of this year I wrote about the covert bailout that was buried in the Obamacare bill which gives $5 billion of taxpayer money to unions, states (for public employees) and corporations for health care coverage for retirees aged between 55 and 64. The program is called the Early Retiree Reinsurance Program or ERRP. The UAW is the largest single beneficiary, receiving over 200 million dollars. General Motors also gets a piece of the pork with about a 20 million dollar cut. A recent report by the Washington Examiner identifies early retirees (many of whom are being paid over $100,000 a year in pension payments) of the California Public Employees Retirement System (CalPERS) as the other top recipient of about 200 million dollars.
"Jobs that Americans won't do" is a weak, if common rationale for high levels of immigration. Get set for an equally dubious idea to justify immigration: "housing that Americans can't buy." Senators Charles Schumer, D-N.Y., and Mike Lee, R-Utah, are believers. And they're offering a sweet deal. On Thursday, October 20, the two lawmakers unveiled legislation, the Visa Improvements to Stimulate International Tourism to the United States of America Act, or VISIT-USA Act (S.1746), one of whose elements would provide renewable three-year resident visas to foreign nationals who invest at least $500,000 in residential real estate here. The plan thus assumes both the need for a housing industry bailout and a large injection of foreign capital toward that end. Supporters should spend some time pondering the downside.
On October 28, NLPC filed a formal Complaint with the Federal Election Commission (FEC) against Rep. Gregory Meeks (D-NY), his campaign, and his "leadership" political action committee called Build America PAC.
The Complaint alleges that Stanford Financial Group made illegal, in-kind contributions to Meeks' campaign for a 2008 fundraiser in the Virgin Islands. The event was hosted by R. Allen Stanford, who is currently in prison awaiting trial for charges related to his multibillion-dollar Ponzi scheme.
General Motors has staked much of its credibility on the Chevy Volt. GM has a goal of selling 10,000 of the vehicles in 2011 and is only about half way there with two months remaining. Ad spending seems to have ramped up faster than sales though with much of GM's marketing dollars going towards Volt commercials while only 1,108 of the vehicles sold in October. I can't remember ever seeing as many TV ads for a vehicle that has sold in such low numbers. Despite the low proportionate sales to hype ratio for the Volt, sites like Mother Nature Network are proclaiming success for the Volt with the headline reading "October was a great month for Chevy Volt Sales."
Submitted by NLPC Staff on Fri, 10/28/2011 - 11:40
The House Ethics Committee may soon conduct a complete investigation of Congresswoman Laura Richardson (D-CA). She has been under investigation for some time now for allegations that her staff undertook political activities while working on government time.
As reported this week by John Bresnahan in Politico, Ethics Committee staff members have been looking into potential Richardson violations since last year. At isssue is whether some of Richardson senior staff pressured subordinates to work on her reelection campaign matters during official time. This is against House rules and federal law.