11:10 AM 2013-05-20
TWO questions to answer-- WHY F/Ford Motor is up? WHO is driving it up?
Bleecker covers WHY very well. The WHO can be found at the Yahoo news for the ETF with ticker IYK (Date may 17)
MORE ON WHY. Reasons for Ford going up include new dividends that stop it from going down much, driving out "dumping shorts" since last August. Bleecker rightly talks about the yen and how an aging population in Japan hurts their economy. My two cents- High energy costs for many will make the shipping part of their exporting expensive. More countries than we might think thus might need to keep local any production meant for local buyers, for that reason?
IMPORTANT-YEN CURRENCY WILL CHANGE. The Japanese cannot de-value their yen for long, due to low natural resources for energy. Stock-piled energy inventory shipped in earlier from outside Japan will start to deplete. Japan then will let the yen rise, to better afford replenishing their energy stores. Energy is a MUCH bigger problem for them than before. Why? Two of their nuclear facilities (a cheaper fuel than oil or natural gas) went scarily kaput after the 2012 March tsunami. Staggered electricity losses hurt local manufacuring. It hurt less those Toyota and Honda plants in the US. using US suppliers instead of Japanese-made parts.
SPECULATION-MORE ALT-ENERGY AUTOS?? In the meantime, a yen de-valued too far makes gasoline ultra-expensive at the pump. Paying over $7 per gallon (in US dollars ) will force more Japanese to move faster to alternatives--electric/plug-in hybrid cars & other substitutes. Ask yourself, which Japanese car company will benefit more from that change? Does this help explain TM vs HMC price patterns? Watch the ETF with ticker CARZ as the Japanese are a big part of it.
Absolutely. Look at the chart. 16 by midsummer. And the bonus of a nice dividend. It's been so long since we've had a healthy auto market, people forget that in the right environment, auto companies can make obscene amounts of money..
Japan is debasing the yen, which is a last desperate attempt to make themselves competitive. As long as their population is aging, this will not avail. US has always been food independent, is about to become energy independent, and, unlike virtually all of the industrial nations (outside of Latin America) is not becoming geriatric. Within 5 years, we will be manufacturing a substantial percentage of the cars Europe buys.