Can you help me compare and contrast at least two different, two-year forecasts from two separate sources, for the Stock Market and Interest Rates of General Motors? I also need to explain the differences between each indicator in the forecast and a rationalization for which forecasts I believe are most accurate. Lastly, how does the chosen forecast affect the operational and planning issues in General Motors?
World Financial Crisis: General Motors
Financial crisis in U.S. have led to serious problems all over the word. Sales are very low in the U.S. auto industry and it will lead to the collapse of a number of dealers and suppliers. Stressed General Motors (GM) is expecting low sales in the coming months. According to the reports, company is losing $ 2 bln every month and if not supported by U.S. Government, automaker may go bankrupt (Usborne, 2008). Another major problem for the GM is related to huge liabilities which reduces its competitiveness. Company has incurred huge losses in the third quarter of this year and the liquidity position is also weak which has lead to drastic fall in the share prices of automaker. The fall in the shares prices is approximately 5% and company is incurring a loss $ 4.5 on every share (Sector Snap: GM, Ford fall on dismal results, 2008).
The article published by Los Angeles Times clearly forecasts the future of General Motors in coming two years. It is forecasted that the value of General Motors shares would become worthless. The shares prices would come to zero in the coming year. It is expected that in the first two quarters of the year 2009, company will become highly illiquid and may run out of cash in the year 2010. Deutsche bank has predicted target price of GM's stock to be zero and they are confident of General ...
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