11 May 2005 

GM Close To a Finale Point

GM currently pays over 6 percent per annum on their dividends and has
promised to do so on its summer quarterly dividends. Taxed at 15 percent
this isn¹t bad compared to a fully taxed savings account earning 3 percent
that the Federal Reserve Chairman is so clamoring for citizens to Œinvest
in¹ and Œenhance US savings.¹ GM¹s summer dividends will be paid from a
liquidity pool of prior borrowed funds - and possibly newly issued junk
bonds ­ if there are any takers.

If only the GM corporate board had a taxable population base to cover their
ongoing debts and future forward pension and health care obligations, then
they could have the out similar to the United States government. Most
probably a portion of those pension funds will ultimately be covered by US
taxpayers.

And so the GM borrow-long-to-cover-short game appears to have a few more
musical chairs left. Or does it?

The fractals tell a different story. The fractal valuation decline since
January 2004 gives a very clear picture of the business and debt
difficulties experienced by the yet to be dropped from the Dow 30 former
giant. Today potentially completed a fractal sequence of 7/17/ 14 in the
center of a terminal 5 day cup. In spite of having a major buyer promoting
the stock, the gap down prior to the onset of this fractal series has not
been completely filled, elucidating a profound weakness in the stock and
corroborating the S and P bond rater¹s debt rating.

The impending defaults by GM, Ford, and the GSA¹s, the latter with their
thin liquidities and weak portfolios of bubble mortgage owners will soon
have a domino collapsing effect on the US debt derivative and fractional
banking system

G. Lammert