Changing Tides

DOW: Goodbye 8,000

Yes, LNR already told you that the DOW would find support at the 6,900-7,200 level, so it’s no surprise that the DOW ended below 8,000. What LNR is surprised at is that the major media kept posing the question at each new low- IS THIS THE BOTTOM ? That is cheap journalism with no substance to the readers. LNR firmly states and has stated several weeks ago where the bottom is. LNR offers substance and analysis actually useful to the readers.

Detroit- Kill the Companies, Save the Workers

LNR is surprisingly in agreement with Michael Moore regarding Detroit. Taking conservatorship of the failing auto companies, but hiring a management firm that specializes in turn-arounds to run the company. Use bankruptcy laws to break the unions, cut wages and benefits to reflect demand of that product. Keep priority manufacturing in defense products and alternative energy vehicles. Slash and burn out the fat management at the top and streamline the separate divisions.
In this way, you keep sales up- because people will continue to buy the products- in whatever numbers, because they are not afraid the company will go bankrupt- (this has been the major argument the car companies have used for not wanting to go into bankruptcy- to reorganize), you keep vital manufacturing knowledge workers employed- as well as key defense products in America and save many jobs. In the process, you also have a mass change over to alternative energy vehicles completed quickly- rather than the slow lethargic pace Detroit has followed so far. The best thing is, you can fire the fat cats who cheated America for years and save hundreds of millions of dollars in fat pay, bonuses and other compensation. You can apply health benefits from the governments to release that huge burden from the auto companies.