Strong Dollar,Appreciation Recasts Investing Strategies

Chipmaker Qualcomm will buy back 15 billion in stock,10 billion of that over the next 12 months.It has 31.6 billion in cash on hand,and will increase its dividend by 14%.It is contemplating a debt issue plus use cash for the buyback.Shareholders have been pushing for this bigger return on investment.Along with this accelerated repurchase,the company has just announced some new chips that are going to be important to its business.*
General Motors will be executing a five billion dollar stock buyback in the near term.*
The soaring US dollar makes it the worst of times for big American companies with an overseas presence,said Larry Glazer of Mayflower Advisors.There's actually a shortage of stocks out there.You have to change your investment strategy.Ultimately,the strong dollar is a good thing,but a volatile currency is not a good thing.It is hurting the emerging markets.*
Small cap stocks,as well as domestically-oriented US companies and European stocks,which have not appreciated nearly as much as US issues in recent years,are being recommended in these conditions.Margins of the big multinationals are likely to be hit by the strong dollar.*
iShares Small Cap Core ETF (IJR),iShares S&P Europe 350 Index Fund (IEV),Qualcomm Inc (QCOM)

Where To Invest Summer 2014

Deutsche Bank downgraded Dollar General on margin concerns,but Goldman Sachs said the stock is too low,and we're gonna stand by it,CNBC host Jim Cramer said.Too many people downgraded it on what turned out to be a decent quarter.*
Target stores are looking a little dowdy.*
Teen apparel retailer Quiksilver,Inc's balance sheet's not that good there.They lost their surfer spokesman Kelly Slater.*
Union Pacific said autos are great.Once they start ramping up those factories so they can run more,it looks really good for the economy-sorry to be so cheerful.*
Salesforce.com is in that very challenged area.You saw that software as a service got hammered yesterday.It's not the place to be.*
Ford's May sales were up 3.0%,beating the Edmunds estimate of 0.9;GM's were up 12.6%.GM totally blew their numbers away.It's been a monster bad stock.My charitable trust owns it.It's been very low in relation to its sales.*
I went to the Ford F-150 plant,and that is a winner.They make a big margin on the F-150.*
I don't know golfer Phil Mickelson from Adam.FBI agents walked up to him at a tournament.Listen,when the FBI shows up like that,they're making a statement,a frightening statement.*
I like First Solar very much,but they've been eviscerated by Chinese dumping.We're in a bit of a war with China financially.*
One of the things that happens in a bull market is,a guy upgrades a stock and it goes higher.Every one of the health maintenance stocks is on fire.Wellpoint is higher,and I think it deserves to be.You have takeovers,you have analysts making big calls,and it's working.There was a lot of fear and a lot of pain about that stock.I think you'll see the analysts come out of their foxholes and their pillboxes.*
AT&T expects to save 1.6 billion dollars in content costs after year 3 of the DirectTV deal,a 20% cut,adds Cramer colleague David Faber.It is certainly front and center for many of these companies as they see the Comcast-Time Warner Cable and AT&T-DirectTV mergers come into effect.One day CBS and Viacom coul come back together,but I don't want to get too far ahead of myself.Disney is by itself.It's so much bigger than everybody else.They have so many different parts.They have the theme parks.*
Rite-Aid is back.It's no longer a turnaround;it's an earnings per share story.I buy my beer at Rite-Aid.I'm not kidding.When you go into your drugstore,they don't look like they used to,CNBC Wall Street expert Jim Cramer pointed out.*
AT&T(T),Rite Aid Corporation(RAD),Ford Motor Company(F),Dollar General(DG),General Motors(GM),Walt Disney(DIS)

Market Trends:Facebook,GM and Tesla;Sochi Winter Olympics Update

Facebook is a terrific company that I think can go higher,said CNBC co-host Jim Cramer on "Squawk On The Street."I still think this is early on.Facebook deserves to be higher,will go higher.CEO Mark Zuckerberg is giving right now,the most charitable man in America.*
At CVS,the numbers were very strong.They could take a six-cent hit from dropping cigarette sales and still do well.They take the hit and do well.There's a very big anti-cigarette kick in this country.*
The California drought is wreaking havoc on the food business.It's the snack side that worries me,not the mac and cheese.*
The fulcrum here is GM.I've been wrong about GM.It's an inexpensive stock,but nobody cares because of the weather keeping people out of the showrooms.Auto sales are the key to this market,so I'm deeply focused on that.*
China has agreed to subsidise electric vehicles,and Tesla is there.Tesla is a charm stock.They are not bound by anything other than by the enthusiasim of young people who test drive a Tesla and go buy one in five years,according to author and master investor Jim Cramer.*
At the Sochi Winter Olympics on Monday,after 17 years of partnership,American skaters Meryl Davis and Charlie White won the first ever ice dancing gold medal for the USA,and Steve Holcomb and Steve Langton secured the first medal in two-man bobsled in 62 years with their bronze,finishing behind Russia and Switzerland.
Fog postponed the men's snowboard snowcross finals,as well as a biathlon event.Snowcross was rescheduled for Tuesday,although more fog is expected to roll in and blanket the course.
The US women's ice hockey team clobbered Sweden 6-1,getting Team USA to the finals against archrival Canada,as had been expected.
Belarus swept the freestyle skiing aerials when Anton Kushnir won the men's gold medal.Australian David Morris' silver was the first medal for his country in men's aerials,and China's Qi Guang got the bronze when he botched his landing.*
CVS Caremark(CVS),Tesla Motors(TSLA),Facebook(FB)

Market Views:GM,Tesla and the Fate of Coal

Burberry's numbers were great,but the store numbers were bad,said CNBC analyst Jim Cramer.They were all digital.*
At Bank of America,your expenses are going down.Deposits are going up.I think the stock is more of a buy than Citigroup.*
I think GM stock going down is just a screaming buy.Whether there is a price war,what's far more important is the pension headwind going tailwind.
There's an element of rigour that Ford and GM have that Tesla has to stick to.This is a cult stock,so their recall of the word "recall" was tweeted.This is a press release company.When they go up from two to four cars in China,I'm talking about a big revenue increase.I'm not gonna get in the way and short this stock.Their cars are loved.These are sea change stocks.If you believe in electronics and solar,then you believe CEO Elon Musk is giving you two great stocks in Tesla and SolarCity.*
BMO has upgraded Intel from hold to buy on PC sales stabilising.There is a point at which I buy Intel.If the Hewlett-Packard comeback is for real,then Intel and Microsoft are possibilities.*
A lot of people think coal is coming back.Oh,will you give me a break?Coal is going away.The shrinkage of coal because of the EPA is just taking people's breath away.They're not even buying equipment to mine coal.*
BlackRock had an amazing quarter.CEO Larry Fink is doing a great job there.
American Express is doing very well.They're doing a remarkable job at expense control,but my charitable trust has sold it.That stock is not where I want it to be.I think Capital One is the leader in that category,master investor Jim Cramer observed.*
Captial One Financial(COF),General Motors(GM),BlackRock(BLK),Intel(INTC),Tesla(TSLA),SolarCity(SCTY),Burberry Group PLC(BRBY),Bank of America(BAC)

Hedge Fund Takes GM Stake

Hegde fund Hayman Capital Management has taken a stake in General Motors.You're starting to see them take market share back,said Hayman founder and managing partner Kyle Bass.With their new 2014-15 product line,they're gonna increase dividends and buy back stock.Given how cheap the stock is,we think it should be trading in line with Ford.When you look at the enterprise value,it's about 47 billion dolars.
A 100 basis point move takes eight points away from their pension liability.We think that could actually go down to 17 billion dollars.We just think from a catalyst-driven timing perspective,now is the time to invest in GM.
The new GM products will take North American sales back.You have them really working on all cylinders.Motor Trend gives it the New Product of the Year last year.We think it's incredibly cheap and it's gonna move much higher next year,Mr.Bass noted.*
The federal government has announced it has exited its stake in GM,as Mr.Bass predicted it would by the end of the year.The taxpayer lost 10 billion dollars on the bailout of the automaker.*
GM shares closed at 40.90 in Monday trading,up 1.82%.

Working To Improve:GM Banks On New Intros

All segments of General Motors saw a sales increase in Q1 except GM Europe,where sales fell off a cliff by 19.8% in the midst of a Euro-zone recession.Overall,it was a successful quarter for the fabled carmaker,beating Wall Street expectations on both profit and revenue growth.The company has a 15.1% share of the Chinese market,but has to share that revenue with the local joint venture partners required by the Chinese authorities.The U.S. government still owns about a third of GM,which it acquired during the financial crisis in order to save the corporation and its UAW jobs. Chief Financial Officer Dan Ammann said we're working every day to improve the profitability.We're having great success with new introductions.We have 20 or more new launches around the world this year,and that's what's gonna drive sales.We're working hard on both the revenue and cost-cutting side of the business.We're working to do everything we can within the constraints of the European situation.We've taken a lot of action on the cost side in Europe in the past few years-not just the past few quarters,Mr.Ammann pointed out. General Motors(GM)

NCAA Basketball Championship:Eyeballs May Have Strayed

After The Fray's charming acoustic guitar and drum national anthem,the NCAA Championship basketball game was trending downhill,though with some blips of excitement.The Kentucky Wildcats seized control early and made it clear they likely wouldn't relinquish it to the Kansas Jayhawks.The game started too late to begin with-9:23 Eastern.Despite a football style crowd of 70,000 screamers in the New Orleans Superdome,the air was gradually being let out of the broadcast balloon.
Sponsors of the CBS telecast included SABMiller PLC;Capital One Financial;AT&T;Chrysler;General Motors;Daimler Benz;Liberty Mutual;Nissan Motor Company Ltd.;Coca-Cola;and TD Ameritrade.The initial audience was no doubt of exceptional size,but one can see how it may have trailed off considerably before too long,depriving these firms of many of their highly desired eyeballs.
Kansas made a late run,but number one-ranked Kentucky won 67-59 for the team's eighth national championship.

With Big Profit,GM Back On Top

General Motors came back last year to achieve the most profitable year in its history,earning a record profit of 7.6 billion dollars.This put it back in the spot of the world's largest automaker,displacing Toyota Motors.
We're growing profit,but we've got more work to do all across the company to get it to where we want it,said GM Chief Financial Officer Dan Ammann.We've been in a restructuring plan.It made over a billion dollar improvement,but clearly it's not going far enough in this environment.
We're in a discussion with our shareholders and other stakeholders.We had north of 11% return in the pension plan assets,which has helped us a lot.This is a long term game.We've got a lot of actions that won't bear fruit until two or three years out,Mr.Ammann indicated.
The record profit will be shared in the form of 7,000 dollar bonus checks for every GM autoworker.As part of its restructuring plan,GM closed 14 plants and three service parts operations.It had received 49.5 billion in government assistance.For the government to recover this,the GM share price will have to double.
As part of its 2009 bankruptcy,GM had closed more than 1,300 dealerships in the U.S. and Canada,evoking widespread bitter criticism.Thanks to Congressional action,a little more than half of the closed U.S. dealers,or 661,were eventually invited to apply for reinstatement based on their business metrics.
General Motors(GM),Toyota Motors(TM)

Industrial Management:A New CFO for General Motors

Chris Liddell,the widely respected chief financial officer of General Motors,has announced his resignation.Company treasurer Dan Ammann has been chosen to succeed Mr.Liddell.
Harry Wilson,a former member of the White House auto task force,said Mr.Ammann knows the company quite well.I would expect him to be long term.
The speculation was that Mr.Liddell was looking beyond the CFO position.That was reasonable given his age and accomplishments.He certainly did a good job in his 14 months at the company.
GM's was the biggest cultural change of any organization in U.S. corporate history.It went from mediocrity to success,which was played out on the world's biggest stage.
Mr.Liddell was the only outsider there.The others were holdovers.
The challenges GM and Mr.Ammann will face are:
1.Maintaining its high level of profitability
2.Continuing to revamp its product line
3.Stabilizing its executive ranks.
General Motors(GM)

BlackRock Favors Cash Flow Companies

BlackRock,the world's largest money manager,is favoring companies with lots of free cash flow,according to Vice President Bob Doll.These are in the telecom,health care and energy sectors.You need diversification,but clearly you've got to focus on that free cash flow.
BlackRock did buy some six million shares of GM on the initial public offering,but they continue to hold a bigger position in Ford.Ford continues to pay down their debt and improve their margins.
The whole story is a cyclical one,Mr.Doll believes.He thinks there's more cyclical improvement coming.GM stock could rise into the low 40s.
General Motors(GM),Ford Motor Company(F)

What GM Has To Do

GM has been reborn as a public company,exceeding its listing price of 33.00 a share last week.Behind the shares is a business model with a level playing field between union costs and management costs.
Each of GM's four regions has a different set of challenges and objectives,according to CEO Dan Akerson.The North American blueprint is how GM will address the European issues:reduce costs;match capacity with demand;offer the best vehicles.GM has a great auto portfolio in Europe.They hope to see profitability there in 2012.
The great car that GM has today is based on the resilience of the GM employee.GM has the resident expertise to provide the best cars you can buy.They have a pretty good balance sheet right now,in Dan Akerson's opinion.
Mr.Akerson wants to make GM more of a consumer marketing company.Their goal is to have zero debt on the balance sheet,and even pay down their entire pension liability to the extent possible.
GM is much more global than Ford.They have to have the ability to make a car unique for the particular market,Mr.Akerson feels.
General Motors(GM)

A Rough Ride Ahead

General Motors has a significant hurdle to climb with the bondholders,Michigan governor Jennifer Granholm noted.You can read the tealeaves in the Chrysler news.GM is the next shoe to drop.Let's support the home team,the governor urged.Let's make sure we have a viable company on the other side of bankruptcy.We're gonna have a tough period of time as the Chrysler plants go into hibernation for the next 30-60 days.People feared there would be a liquidation,but these companies are not gonna go away.The bankruptcy announcement will ensure the survival of Chrysler.If the court does what it's supposed to do,the risk to jobs will be greatly diminished,Governor Granholm pointed out.

Automakers Critical To Canada

The Canadian government,on both the national and provincial level,has been watching the U.S. automakers with great concern.The automotive industry is Canada's largest manufacturing segment,directly employing more than 150,000.The industry contributes more than 14% of Canada's manufacturing output,sustaining 12 Ontario communities.In consequence,the Canadian authorities are providing 3.29 billion dollars U.S. in loans to Canadian subsidiaries of General Motors and Chrysler.The federal government will give 2.09 billion,while Ontario will provide another 1.2 billion,said Prime Minister Stephen Harper and Ontario Premier Dalton McGuinty.President Bush is authorizing 17.4 billion in aid to the struggling automakers.Ford Motor Company is not included in the loan packages,as it only needs a back-up line of credit at this time.

Ford Presents Plan

Ford Motor Company has presented its recovery plan to Congress,along with its peers Chrysler and General Motors.Ford intends to return to profitability by 2011,speeding development of fuel-efficient vehicles such as an electric van and an electric car by 2010.The old line firm will devote 14 billion dollars to advanced technology research,while management will forgo bonuses and CEO Alan Mulally works for one dollar a year.Ford will close two plants by the end of the year and plans to sell its Volvo unit.Although Mr.Mulally says Ford has the near term liquidity it needs,it would like nine billion in bridge financing,in case the financial crisis is protracted.One Nobel laureate,Paul Krugman,thinks the crisis may run until 2011.Before the financial crisis,the U.S. auto industry was gaining strength.Now all automakers worldwide are in difficult straits.

Smiling In The Gloom

While most stocks were plummeting last Thursday,Ford Motor Company was gaining.That is why CEO Alan Mulally was smiling.Ford had just posted its first profit after 7 consecutive quarters of losses.The soft-spoken leader said he wasn't really surprised by the results,and he was cautiously optimistic about reaching a deal with the United Auto Workers union.Although there could be setbacks ahead,by the end of 2009,Ford should be back in the black for good.The automaker is exploring the sale of its Jaguar and Land Rover divisions,and conducting a strategic review of its Volvo unit.Sixteen plants are to be closed,paring 45,000 jobs.The Ford Edge is the best-selling crossover vehicle,and 14 Ford vehicles recently won J.D. Power quality awards.Ford was the most actively traded stock on Monday.This morning,General Motors(GM) also released good second quarter numbers.