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Suggested Predictions
Ziibos (11)
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Some people are half-expecting the U.S. auto industry to disappear soon. In terms of the hole that General Motors Corp. and Ford Motor Co. would leave in the S&P 500, it's not that troubling.
Combined, both companies have a market capitalization of less than $8-billion (U.S.), which translates into a weight of less than 1 per cent of the S&P 500. In other words, their direct impact on the stock market is small. If just half of the auto industry collapsed, the result would still be the loss of two million jobs, thanks to a ripple effect. Will Ford or GM seek for rescue from the US government in 2008?
Comments (3)
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Also, if I can have this clarified too: by answering "yes" to this prediction, are we saying that the government will PROVIDE the bailout, or just that the company is ASKING the government for a bailout?