The Golden Truth: GM's Earnings: More Orwell and Less Truth

Monday, May 17, 2010

GM's Earnings: More Orwell and Less Truth

How real are GM's earnings? I don't know. I can't find any information other than brief news summaries announcing an operating profit based on better sales and cost-cutting. I would really like to find a GAAP-prepared financial statement. If anyone can come up with one please link it in the comment section.

Personally, given that we know that the Government is looking to unload its 60% stake in GM, I don't believe the numbers released today. Put faith in them at your own risk - caveat emptor. We do know that GM is looking to get back into subprime auto loans and that Toyota sales are rebounding. I would suspect that the numbers released today are about as reliable as any other the Government reports. In other words the believability factor is zero unless the Government/GM is willing to publish full financials with an independent auditor's report attached.
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Regarding today's Empire State manufacturing index: it came in much lower than expected BUT the prices paid component reached its highest level in a year...

13 comments:

HopiumMonday, 17 May, 2010
The bubble talkers are talking BS as usual.

http://www.goldalert.com/stories/What-Gold-Price-Bubble
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HopiumMonday, 17 May, 2010
http://www.forbes.com/feeds/prnewswire/2010/05/17/prnewswire201005170830PR_NEWS_USPR_____DE05678.html
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Dave in DenverMonday, 17 May, 2010
Thanks for the link, but that's not what I'm looking for. That reported numbers don't tell us anything. They even say that in the press release:

"While management believes that these non-GAAP financial measures provide useful information, they are not operating measures under U.S. GAAP and there are limitations associated with their use"
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U-6Monday, 17 May, 2010
Tulving is sold out of US junk silver, silver Maple Leafs, and RCM silver bars. Also, no gold British sovereigns or Swiss francs.
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Return to ResistanceMonday, 17 May, 2010
Dave,

Way off topic here; but I wanted to find out if you had a chance to listen to the gold manipulation debate at financialsense.com. Bill Murphy didn't do GATA any favors with that performance.
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Dave in DenverMonday, 17 May, 2010
Hey RtR: did not listen. Listening to anything Jeffrey Christian has to say is a tragic waste of brain cells.

The manipulation debate is not a debate if you look at the numbers. Read Gene Arensberg's latest posted on www.goldseek.com.

Anyone who argues against manipulation is either tragically corrupt or tragically stupid. Christian is likely both.
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Dave in DenverMonday, 17 May, 2010
U6 - thanks for the heads up - did not notice that when i was on his site earlier - was checking his bids, which he has pretty raised across all products
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JRMonday, 17 May, 2010
Does this do it:

http://tinyurl.com/2dybkg9
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JRMonday, 17 May, 2010
Off topic question about gold:

I was investigating the total amount of gold above ground, and saw a discussion comment on the gold wikipedia page stating there are more gold than officially proclaimed. Are you aware of any of this and is there truth in this?

User comment:
'This number has to be way off or just based on bullion reserves by major nations. If you take in account human history and the masses of gold that we have mined through different methods over the last 5000 years, I would really estimated it to be around the 1,000,000 tons or so. My company assist in dust deals and we move about 3,000tons per year or about 1.8% of the worlds gold if the numbers were correct. Only about 100tons or so actually goes to market. Most of it goes into private reserves to be hedged against. I have even be into private vaults with over 20,000tons that were completely off the gold records.'
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Dave in DenverMonday, 17 May, 2010
JR: thanks for posting the GM link. Unfortunately it's not really much more illuminating than the press releases. All it does is raise more questions about what kind of accounting short-cuts were utilized to produce the numbers. Does anyone really believe that their expense margins REALLY decreased that much? Based on what? The union didn't concede anything. We need a true cash flow statement which they don't provide (of course). Check this out, directly from the filing:

While management believes that these non-GAAP financial measures provide useful information, they are not operating measures
under U.S. GAAP and there are limitations associated with their use. GM’s calculation of these non-GAAP financial measures may
not be completely comparable to similarly titled measures of other companies due to potential differences between companies in the
method of calculation. As a result, the use of these non-GAAP financial measures has limitations and should not be considered in
isolation from, or as a substitute for, other measures such as Net income (loss) or Net income (loss) attributable to common
stockholders.
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Dave in DenverMonday, 17 May, 2010
RE: the question on the amount of gold above ground: I doubt anyone really knows the real story. But it sounds like that gold dust guy smokes a lot of angel dust and the sprinkles fairy tale dust about his operations LOL.

Here's what we do know - and this is even more true right now since CB's globally have become net buyers: the world is "consuming" about around 1500-2000 more tonnes/yr. than it is minings. Up until 2009, the CB's were bridging gap. No mas.
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Return to ResistanceMonday, 17 May, 2010
Dave,

I agree; the manipulation is no longer a debate, and I can understand Bill's frustration having to debate such a weasel like Christian. That being said the burden of proof is still on GATA to prove the manipulation and I felt Bill's emotions got the better of him.
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Dave in DenverMonday, 17 May, 2010
GATA has proved the manipulation ad infitum. The Maguire emails should be all we need. The seriousness of this can be seen in the hit and run on Maguire 2 days after the CFTC hearings.

I didn't realize Puplava was such an apologist for the purveyors of paper gold. I guess he must sell products like the BMG funds so he'll defend the paper products to the bitter end. His clients will suffer when the whole thing goes up in the flames of delivery demands that can be met.
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Add comment

Why Gold?

Gold is the world's oldest currency. You exchange your fiat currency (dollars, euros, yen, yuan) into gold as an insurance policy against catastrophic Central Bank and Government policies which serve to destroy the value of fiat currencies and destroy democracy.

Gold can ONLY be considered an investment to the extent that it remains significantly and historically undervalued in relation to the fiat currencies against which its value is measured. Otherwise it remains the world's oldest currency and is completely free from the counterparty risk associated with currency by Government fiat (i.e. fiat currencies rely on a Government's "full faith and credit.")

Quote Of The Month Courtesy of "Jesse"

Unfortunately for Larry Summers, Ben Bernanke, and their friends at the BIS, they have not yet figured out how to print physical gold, silver, and other essential commodities, and the world is reaching the point where it might simply start ignoring the New York based markets with respect to essential commodities such as basic materials, oil, foodstuffs, and the like, as they become increasingly irrelevant, fraudulent, and Orwellian. And then where will the financial engineers be, except with no more excuses and no place to hide?

Here is the link to his entire commentary, well worth a read:

http://jessescrossroadscafe.blogspot.com/2010/07/gold-daily-chart-shock-and-awe-for.html

Great Quote From Jim Rogers On Govt CPI Reporting

JR: I mean, we have inflation now. If you go to the shop, whether it’s groceries, or education or insurance or health care, prices are going up for everything. The government lies about it in the US. Some countries lie, many countries don’t: Australia, China, India and Norway. Many countries don’t lie about it and acknowledge that we have inflation. Others lie about it, the UK and the US, but if you go shopping you know prices are up.

Q: Are you saying that the American Consumer Price Index (CPI) published by the US Bureau of Labor Statistics is a lie?

JR: In my opinion, yes, of course it is. Have you looked at it? They’ve changed their accounting several times in the past few decades. When housing was 20% to 25% of the CPI and housing was going up, they didn’t count it, saying rents weren’t going up, and then when home prices started going down, they counted it. It’s the same with many things. It’s staggering some of the tortuous reasoning that the BLS has used over the past 25 or 30 years. When the price of gasoline goes up, they say it’s not really going up because it’s better gasoline, better quality, therefore you’re getting more for your money. I mean, it’s endless, the stuff that they say and for some reason people sit there, although more and more people are catching on, and accept what the government says.

source: www.clusterstock.com

Quote of the Week

"The primary function of a Central Bank is to engage in the massive transfer of wealth from the middle class to the wealthy elite. The Federal Reserve was set up to do this with the blessing and support of Congress." - Dave in Denver

If you refuse to believe the above, please read "The Creature From Jekyll Island: A Second Look at the Federal Reserve" by G. Edward Griffin and then explain to me why the Senate voted down the Vitter Amendment and Congress refuses to pass a law requiring a full audit of the Fed, even though the Fed is using taxpayer-backed money to bailout Wall Street and Europe.