Seeking alpha is the mission of all portfolio managers. They haven’t found much of it lately but that is about to change. A prominent brand of FIAT (no, not fiat money ,there is enough of that, but as in Factory , Italian, of Automobiles from Turin) Here is an example.
It is the Alpha Romeo GT, arguable the best built sports car in its price class. Better styling, better mechanics than even the Germans make; you can go through a hairpin at 100km/hr with this thing. It is very civilized as it even requires “warming up†before you take it for a spin. Unfortunately this kind of car is wasted on North Americans and certainly does not do as well in Canadian climes. FIAT itself is not that hot lately either; here is a chart.
Going from 32 to 4 is not exactly confidence inspiring, but then going from 4 to 10 clearly is. So why the turn-around today. In my view it is fairly simple having recently had some experience with this myself. Money is not the life-blood of capitalism, contract law is. Without the ability to agree on certain things in the knowledge that the agreement will be honored we would be left with pure chaos. We already have some of that as the Unions become shareholders and the Government steps in as operators, but today Obama revealed an unbelievably anti-capitalist attitude in publicly vilifying the bondholders as recalcitrant speculators etc. and in the process denying them the usual remedies under law. This is completely and totally unheard of and will, no doubt, have many unintended repercussions. Where is $1 Lee Iacocca?