For those of you who watch the financial channels, GM did a well orchestrated dog and pony show this morning as they announced their restructuring and reorganization plan. Whether you like it or not, times are changing. Companies like GM can no longer act like government pension centers; they are no longer the big kids on the block.

Piece by piece, unions in this country are being ripped apart. I have mixed emotions about this since every business needs some sort of compliance or disciplining to keep them straight. A few other professions that need some compliance and oversight are the medical and legal professions. In our greed stricken society, we can never be sure if anyone is being straight with us anymore.

I am not sold on unions being the best overseers of a companies dealings however. In the past, the internal workings of the UAW and other unions have been controlled by organized crime.

GM raised its job cuts by 5,000 to 30,000. This is an effort to remove $7 billion of expenses by next year, which is $1 billion more than previously estimated.

I don't think GM is dead by any means. In 2007, the company is going to announce a new line of hybrids for their top selling Chevrolet Tahoe痴, and GMC Yukon痴. I'm sure other hybrids will follow as well.

I am not going to add GM to the IA portfolio, but for speculative investors, the stock looks like a decent bet.

As GM closes plants, and cuts personnel, the ripple effect with its suppliers is sure to be felt as well. The economy was going to slow on its own anyway, but GM's news will accelerate the process.

THE MARKET:

I have not changed any of my opinions. The S&P looks like it is ready to make an effort to break through the 1250 mark. If it does on high volume, it could carry the index up another 3-5%. At this point I will not be impressed, but will be working feverishly to lighten my portfolio of stocks.

VIEWER COMMENTS:

I would like to thank those who have expressed your enjoyment with the website. As your probably aware, it takes a lot of thought and work to condense the technical aspects of investing into common sense, everyday terms. I will do my best to continue bringing you some insightful commentary.

Here's a comment from RC:

Don't financials typically perform poorly w/ high(er) interest rates?

Yes, and I your probably referring to my comments that financials should be accumulated sometime during the next decline in 2006.

The Financial sector has had a nice run in recent weeks. This is partly due to short covering (the sector was heavily shorted), and institutional accumulation ahead of the next move in the sector rotation model.

When the economy eventually bottoms in 2006, one of the first sectors to benefit will be the financials. At this point, rates will have stopped rising, and the economy may be weak enough where rates may actually start declining.

Short term rates have already risen more than 3% from their lows, and we probably have 50 to 100 basis points left in this tightening cycle. So, I believe we are closer to the end of the rate hikes, and thus financials should be on investor痴 radar screens.

Here's a comment from Sergio:

How about SLB for a short at your sell price - looks over-extended.

I don't know if SLB is extended or not. In past oil crunches, SLB has reached $120 under similar circumstances. That may happen yet. One thing that does seem apparent is the oil sector is temporarily going out of favor. This is a normal progression in the sector rotation process. I may be a little early, but I don't like being late.

I had a question of whether there was a charge for the IA blog. No, there is no charge for the Investor Alert. I am working on a subscription based newsletter for No-Load Mutual fund and Exchange Traded Fund (ETF)investors. This service, if it ever happens, will be completely separate from this site.

I am working on this newsletter with one of the most famous stock pickers, and portfolio managers on Wall Street. We are applying his research and stock picking evaluation system to No-Load Funds and ETF's. The initial results and backtesting have revealed some dynamic performance! I'll let you know when this service is available.