This month I've decided to push up those poor auto stocks. The carmakers can break sales records every month and profit records every quarter. They buy back stock, and still their stock prices suck.
Yes, that is the correct word for heart-breaking P/E ratios of 9 or 10 or 11. The poor partsmakers are worse, and ifCorp.'s stock is the best of the bunch, it's only because GM owns Hughes Electronics, and Hughes is New Economy Tech.
The New Economy doesn't care about solid profitable business and regular dividends.
Motor Co. says it's going to pay out extra dividends worth $10 billion cash, plus extra stock if folks want. It's a minimum $8 a share extra payout, and maybe $20 - and this for a $60 stock. So Ford stock moves up a few miserable bucks. That's when I decided to step in and tell Detroit to join the New Economy instead of fighting it.
I call my plan "Wants You To Be a Multi-Millionaire." The aim is to:
1. Push up the price of the stock, double it at least.
2. Promote the sale of Ford products.
3. Save the company money, $1 billion a year, in real money.
4. Excite all America talking about Ford and the Ford TV Show (see below). Here's how it works:
We'll start with that extra dividend of $10 billion cash. Instead of $8 a share for each of 1.2 billion shares, Ford would pay out a single dividend of $100 million to the holder of one share of stock every week for two years.
The winner is picked in a weekly hour-long TV show, The Ford Wants You To Be a Multi-Millionaire Hour, hosted by Billy Crystal. Some on my staff want Regis Philbin, but I'm for Billy. It's negotiable.
The winning capsule with the share of stock is picked by everybody's favorite, Pamela Anderson. The second weekly prize is a $1 million house wherever the winner wants, and the prize-winning number is picked by Denzel Washington. The third weekly prize, picked by Julia Roberts, is a six-week trip around the world on the fabulous Ford yacht, fully crewed and paid for, for the third-place winner and his guests. My staff says Ms. Roberts won't want third, but we'll make it up in big close-ups.
There is entertainment. Barbara Streisand and Aretha Franklin are regulars on The Ford Hour.
Hey, is this New Economy or not?
But we're not done.
While a $100 million winner is picked each week, the winner's name and second- and third-place winners' names are announced on the following week's show, when they appear in person.
So Pamela leans forward, way forward, and picks a number out of the bowl, and says something like..."The winner is... ooou...I'm keeping that a secret right now, but now, for the first time ever, I can tell you that last week's winner is..." Then up comes the gushing winner.
The winners also get a Ford car or truck, which is rolled on the stage, and the winners drive off. The $100 million winner gets a certified check or maybe sacks of real cash. My staff is working on this.
1. What about the widows and orphans? Answer: They can buy utility stocks.
2. Will the funds buy it? For a shot at a $100 million dividend? Sure. They're nuttier than the rest of us.
3. Taxes. We work with Congress to get it treated as a special long-term Internet gain, which will be better than a capital gain. This is the New Economy. We don't tax Internet sales; why tax New Economy dividends?
4. How does it save money, sell cars and keep from wearing out? Good questions. We'll deal with them now.
Naturally, the $100 million dividend will become ho-hum in time, even though it lasts only through the 100 weeks (Question to staff: Do we do summers or reruns?).
Here is your answer. Your regular Ford quarterly dividend is 50 cents a share for the 1.2 billion shares. Who wants 50 cents? No wonder the stock sucks. We junk the 50-cent quarterly dividend to all stockholders and...hold your shorts up...PAY A $300 MILLION QUARTERLY DIVIDEND TO ONE SHARE OF STOCK, EVERY QUARTER on the FORD SUPER MULTI-MILLIONAIRE QUARTERLY SHOW.
And a share of stock is given to every purchaser of a Ford vehicle, worldwide. Yes, this is Global. Yes, every purchaser of a Ford vehicle, worldwide, gets a chance to be a dividend multi-millionaire. Will that sell cars?
How will Ford save money? That 50-cent quarterly dividend for 1.2 billion shares is $600 million a quarter. We're paying $300 million, so even after paying out what the show costs, we save Ford $1 billion a year.
Is this New Economy or what?