After months of of discussions and speculations General Motors laid out a massive restructuring plan. In order to qualify for farther government loans, GM proposes to get much slimmer. For starters, company will cut 21,000 U.S. factory jobs by next year. This is on top of previously announced cuts. The 9 to 11 weeks factories shutdown this year to lower car inventories, has not been mentioned today, but is still  expected to happen. Another cost cutting initiative is a phase out of Pontiac brand. The details are not worked out but Pontiac cars would stop rolling out of factories no later than next year, and the futures of Hummer, Saturn and Saab will be resolved by the end of this year. This is going to have huge impact on suppliers, some of which might be put out of business. I can only imagine all the threads on  forums screaming about a demise of an American icon and maybe even petitions to keep it rolling. Should be interesting.
GM said that it will ask the government to take more than 50 percent of its common stock in exchange for canceling half the government loans to the company as of June 1. The swap would cancel about $10 billion in government debt. In addition, GM is offering the UAW stock for at least 50 percent of the $20 billion the company must pay into a union run trust that will take over retiree health care expenses starting next year. If both are successful, the government and UAW health care trust would own 89 percent of GM stock, with the government holding more than a 50 percent stake. General Motors has received $15.4 billion in government loans to date and faces a June 1 deadline to restructure and get more government money. If the restructuring doesn’t satisfy the government, the company could go into bankruptcy protection. It is more and more likely that Washington will be in a car making business soon. Oh, boy.
Markets have been moving in choppy manner. Currencies had decent size swings, but rather short lived. Dollar has seen some gaines, however most other crosses are pretty much where they started about 20 hours ago. Very good environment for short term traders, both scalpers and people trading a little longer time frames, like 5M or 15M charts. Not that great for the kind activity I describe here. Nothing unusuall, though. Every trading approach goes through thin times. One just has to wait it out. For me this is not a big problem, because I have a lot of other things going on to keep me busy.
Trade from yesterday has not happened. NZD-CAD experienced sideways day, within the pack. The by order is valid for now. I’m placing one more order for a Kiwi cross.

Last week I had a good short trade here. This time I will try to go long. Buy order is set at 55.95, with a 150 pips objective. NZD is behaving bullish, although this might not be fast or very decisive. Which reminds me, a sell order from last week in AUD-CHF was finally filled last night. As of this writing trade is in loosing territory. Will review it in more details tomorrow.

Mike K.