“Who killed GM…..”
I was thinking today; we all have seen the "who killed the electric car" discussions and I wondered if we could one day see similar discussions on who really killed GM and why. My guess is that the suggested culprit would be Big Oil, and by that I mean Really Big Oil, as in Sovereign Oil Companies who really own the oil industry.
But why would they want to kill GM? Could it be because the largest car company on the planet decided to bet the farm on the electrification of the automobile? And take away Really Big Oil’s largest customers, the American people?
Could Really Big Oil want GM so harmed financially that they could not deliver the Volt, or at least at affordable numbers and price so that the Volt fails?
Everyone knew that GM was going to subsidize the Volt by their profitable SUV’s and Trucks. GM bet the farm on this. If you were Really Big Oil and wanted to prevent GM being able to do that, what could you do to harm GM’s sale of those SUV’s and Trucks? Well some might say that the easiest way to kill GM’s profitability and thus its Volt would be to raise the price of gasoline. But Really Big Oil couldn’t raise the price of oil that much could they?
Anyone hearing the testimony to Congress on speculation in the oil markets knows that something funny is going on, but it’s not normal speculation. Because speculators can’t withhold oil from the markets and because there are just as many speculators shorting the price of oil, they should not be making the kinds of differences we see.
Others say that it’s simple supply and demand, that China and India are causing an imbalance. But China and India didn’t just spring to life economically, they have been pretty much consistently growing for ten to twenty years, and the same for their car markets in those countries. But the rise in oil price is more recent and now ahead of the rise in consumption in those countries too, while consumption is static or falling in the West.
Still others say that it’s the falling US dollar that is really affecting the price of oil, which is priced in dollars, and thus especially hurts the US more than anyone else. This is true that the falling dollar does harm the US price of gasoline more than in any other country, but then one has to look at why the dollar is falling.
Perhaps the dollar is falling because of the balance of trade, but that has been out of whack for decades. Perhaps it’s the sub-prime mortgage and credit crunch debacle that’s pushing the dollar lower, or the Fed’s lower interest rates. But the dollar didn’t fall precipitously when for years the Fed lowered interest rates after 911. And foreigners don’t buy many US domestic houses so fear of investing in that market would not make much difference, and up until now US corporate earnings and even the GDP has not even confirmed a recession in the US. Yet still the dollar falls.
But of course the easiest way for the dollar to fall would be if those who own large amounts of it were to sell it or simply stop buying it. And we all know that Really Big Oil, as in Sovereign Oil Companies, are among the largest holders of US dollars. So a very small shift in their buying and selling habits would make for a large effect on whether the US dollar goes up or down.
But would Really Big Oil use their clout on the currency markets, and their ability to secretly push the price of oil up, to raise the cost of gasoline in the US just to harm GM? A company that has done nothing to them except be the first and largest automaker to try to introduce a new technology that would finally free the American people, if they commute less than 40 mile per day, from ever having to buy gasoline from Really Big Oil ever again.
Why would anyone try to destroy a company like GM if they were about to take away Really Big Oil’s biggest customers for the last 50 years?
It will be interesting to see if such “Who killed GM” discussions and perhaps documentaries appear and also to see what they may have to say……..
I was thinking today; we all have seen the "who killed the electric car" discussions and I wondered if we could one day see similar discussions on who really killed GM and why. My guess is that the suggested culprit would be Big Oil, and by that I mean Really Big Oil, as in Sovereign Oil Companies who really own the oil industry.
But why would they want to kill GM? Could it be because the largest car company on the planet decided to bet the farm on the electrification of the automobile? And take away Really Big Oil’s largest customers, the American people?
Could Really Big Oil want GM so harmed financially that they could not deliver the Volt, or at least at affordable numbers and price so that the Volt fails?
Everyone knew that GM was going to subsidize the Volt by their profitable SUV’s and Trucks. GM bet the farm on this. If you were Really Big Oil and wanted to prevent GM being able to do that, what could you do to harm GM’s sale of those SUV’s and Trucks? Well some might say that the easiest way to kill GM’s profitability and thus its Volt would be to raise the price of gasoline. But Really Big Oil couldn’t raise the price of oil that much could they?
Anyone hearing the testimony to Congress on speculation in the oil markets knows that something funny is going on, but it’s not normal speculation. Because speculators can’t withhold oil from the markets and because there are just as many speculators shorting the price of oil, they should not be making the kinds of differences we see.
Others say that it’s simple supply and demand, that China and India are causing an imbalance. But China and India didn’t just spring to life economically, they have been pretty much consistently growing for ten to twenty years, and the same for their car markets in those countries. But the rise in oil price is more recent and now ahead of the rise in consumption in those countries too, while consumption is static or falling in the West.
Still others say that it’s the falling US dollar that is really affecting the price of oil, which is priced in dollars, and thus especially hurts the US more than anyone else. This is true that the falling dollar does harm the US price of gasoline more than in any other country, but then one has to look at why the dollar is falling.
Perhaps the dollar is falling because of the balance of trade, but that has been out of whack for decades. Perhaps it’s the sub-prime mortgage and credit crunch debacle that’s pushing the dollar lower, or the Fed’s lower interest rates. But the dollar didn’t fall precipitously when for years the Fed lowered interest rates after 911. And foreigners don’t buy many US domestic houses so fear of investing in that market would not make much difference, and up until now US corporate earnings and even the GDP has not even confirmed a recession in the US. Yet still the dollar falls.
But of course the easiest way for the dollar to fall would be if those who own large amounts of it were to sell it or simply stop buying it. And we all know that Really Big Oil, as in Sovereign Oil Companies, are among the largest holders of US dollars. So a very small shift in their buying and selling habits would make for a large effect on whether the US dollar goes up or down.
But would Really Big Oil use their clout on the currency markets, and their ability to secretly push the price of oil up, to raise the cost of gasoline in the US just to harm GM? A company that has done nothing to them except be the first and largest automaker to try to introduce a new technology that would finally free the American people, if they commute less than 40 mile per day, from ever having to buy gasoline from Really Big Oil ever again.
Why would anyone try to destroy a company like GM if they were about to take away Really Big Oil’s biggest customers for the last 50 years?
It will be interesting to see if such “Who killed GM” discussions and perhaps documentaries appear and also to see what they may have to say……..
