General Motors Death Wish Comes On-Line Read how the seeds of tomorrows destruction are planted today. $GM $F

General Motors (NYSE:GM) plans to expand new online shopping tools enabling customers to bypass showrooms. GM went bankrupt once because it was an inefficient olde dinosaur. GM and the car business were propped up because Obama was terrified of what the economic impact of creative destruction would bring.

The world is going on-line for everything. Olde school car dealers who are hiding behind state franchise legislation want to kill this on-line. They want olde-school pedestrian traffic kicking tires.

If the dealer culture prevails and GM can’t get traction on-line someone else more nimble will. GM will watch as someone else eats their lunch again. This time Uncle Sam will not want to save the company. Chairman Mao will probably do it for America.

This is tomorrows crisis planting todays seeds of destruction. If the dealers succeed in blocking or delaying the on-line moves they will become a powerful cancer within the GM body-corporate.

George Gutowski writes from a caveat emptor perspective. Follow him on Twitter @financialskepti

More Reasons for Facebook’s Demise. The child’s play dynamic. $FB $LNKD $GOOG $TWIT $YHOO

On a personal note; [personal notes being the only one’s that really count] I have become a grandfather for the second time. The family Facebook pages are full of baby pictures and nice family comments. There is joy in the house and all branches of the family tree.

Facebook with its vaunted advertising machine serves up advertising for an eaves trough product that blocks out falling leaves. No baby products or anything else remotely appropriate.

So special note to Mark Zuckerberg. My new-born grand-daughter does not as yet own any real estate in her own name. It will be some time before she takes an interest in property management issues.

There are lots of other compelling product offers that I and family would be willing to consider. But you seem to be missing it. Hmm $50 @ share plus. Not a candidate for the education fund. Grand Dad may take the responsibility for shorting the stock. The risk is too much for a new-born. Or is it child’s play?

I must admit to renewed insights in diapers and infant clothing.

George Gutowski writes from a caveat emptor perspective. follow him on Twitter @financialskepti

Reasons for Facebooks Painful Demise $FB $TWIT $GOOG $YHOO $LNKD

Sterne Agee analyst Arvind Bhatia said “We think Instagram ads could ultimately command a premium to Facebook ads, although that will likely take a while,” Facebook (Nasdaq:FB) is approaching the tipping point of credibility. They have to show enormous sustainable growth and cash flow to justify a valuation north of $50.

The Sterne Agee comment is typical of Wall Street psycho-babble. OK Instagram will show some growth. But if it is a premium to Facebook, the value proposition should be clear immediately if not sooner. When you buy groceries Filet Mignon is more expensive than stewing beef. There are no arguments.

Arvind Bhatia, (if the quote from Investors Business Daily is believable) in a back-handed way is denigrating Facebook main offering. So what should the Sterne Agee clients do with Facebook?

George Gutowski writes from a caveat emptor perspective. Follow him on Twitter @financialskepti

Obama’s Revenge How He Will Screw You, Me and Everone Else $VIX $XLF $TLT $VXX $BOND $C $BAC $JPM $WFC

President Obama a Democrat and the House of Representatives (Republican controlled) are attempting mutual strangulation. The Democrats are gambling the general population gets tired and turns on the Republicans. The Republicans are gambling the general population gets scared enough by high costs of Obama Care and the chaos of a shut down federal government.

President Obama does have his hands on the power levers of the Federal Government. Remember when your grandfather explained how FDR declared this really long bank holiday so they could re-arrange the financial furniture in the counting rooms behind the vaults.

Watch for Obama to declare a crisis (Duh) and to protect the public from themselves he will shut down the bond and stock markets in the US of A. No crashing markets. No hysterical investors throwing themselves out of windows. Gold will go up; except most people trade in paper gold so you will not be able to really do anything with it.

Basically he will by-pass the Republicans and hold ransom the private wealth of individuals and institutions that represent individuals.

Don’t believe me? Just wait and see.

George Gutowski writes from a caveat emptor perspective. Follow him on Twitter @financialskepti

Alcoa’s Secret Agenda. Surprise Strategic Move $AA $GS $KO $PEP $BUD

Alcoa (NYSE:AA) has been beaten up and slammed so many times it’s hard to remember what it was like when it was in favour. The latest indignity for the aluminum giant was being kicked out of the Dow 30 causing a lot of index funds to sell.

The removal from the Dow 30 may become the silver lining in the coming year. If you believe the market will correct no make that crash in the near future Alcoa would have been a huge sell as index funds sell off and rebalance themselves. This will not be a factor for Alcoa.

The dividend looks very suspect at this point. In God we trust all others pay cash begs the question where will Alcoa source the cash-flow to pay dividends.

Commodities are a very tough gig. Pricing cycles are treacherous and unforgiving. Alcoa has a market cap of about $8 Billion and has been ruthlessly rationalizing cost structure.

There are two significant paths available. Integrate backwards and buy an energy company to mitigate the high cost of hydro power needed to make aluminium. Or be bought by someone who wants secure access to product without relying on a Goldman Sachs (NYSE:GS)  warehouse.

Who uses aluminium cars in great quantity and feels aggrieved with the warehouse tribulations. Oh and the last filter is a large cap that can easily swallow Alcoa. Here is the list of suspects:

Coca Cola (NYSE:KO) 168 billion market cap

Pepsi (NYSE:PEP) 123 billion market cap

Budweiser (NYSE:BUD) 159 billion market cap

Any of these guys could swallow Alcoa, not care about the dividend, absorb the tax loss carry forwards, reduce packaging costs, control supply chains, protect American based jobs and not really notice the capital that it would take to pull the caper off.

So let the stock drift down. Pretend its old school commodities without a secure future. With a few more sell recommendations and some adverse general market moves we can easily see $5 @ share. Then just bide your time and wait for the surprise strategic move.

George Gutowski writes from a caveat emptor perspective. Follow him on Twitter @financialskepti

Twitter the new virgin. Can you Sleep with her? $TWIT $FB $LNKD

Twitter is coming. Twitter is coming. All hail Twitter. So probably on Nasdaq and probably $TWIT as a stock symbol. Nasdaq must redeem itself because a lot of people remember the Facebook (Nasdaq:FB) fiasco and still remember their lawyers telephone number.

The hype is not as crazy  as it was for Facebook; which in retrospect was completely unnecessary. Before everyone pretends they understand the fundamentals of Twitter and social media consider the playful activities of your favourite hedge fund. Long Twitter short Facebook. Just like Apple and Blackberry used to be. Before they both imploded. Hey that can happen you know. Stock markets are risky.

Facebook has experienced an insane run up and probably does not have the fundamentals to back it up. So correction time approaches. Twitter is like the new virgin and everyone wants to sleep with her. We’ll be tolerant for the initial stages because its new and excites us way more than Facebook.

With Facebook we have finished our post coital cigarette and are looking for the next thing.

So it’ll be Wham Bam thank you Mam.

This will be the new pairing just like chocolate and wine. Watch the long short action it’ll drive more than fundamentals for a while to come.

George Gutowski writes from a caveat emptor perspective. Follow him on Twitter @financialskepti