GM, Citigroup dropped from Dow

[sabra]

Source: USA Today

The Dow Jones industrial average, which according to its website, "has chronicled more than 110 years of investing and served as a marker through all of the major developments in modern history," today dropped GM and Citigroup from its list of 30 bellwether stocks. The change takes effect June 8. The Associated Press reports:

Dow Jones said in a statement that Travelers, the property and casualty insurer and one-time division of Citigroup, would replace its former parent. Cisco, which makes computer networking gear, is filling the role left by GM after 83 years as part of the Dow.


Read more: http://blogs.usatoday.com/ondeadline/2009/06/gm-citigroup-dropped-from-dow.html

[Captain Hilts]

1. Wow. ShitiGroup dropped from Dow. Amazin'. nt

[NightWatcher]

2. Bernanke mentioned that the US may take ownership of Citi as well pretty soon

http://www.bloomberg.com/apps/news?pid=20601109&sid=ans2mNbxPb2o&refer=home

[ejpoeta]

3. they said today on msnbc that trading for gm stock would be suspended after the close of business

today. and gm stock is trading well below a dollar right now.

[SnowGoose]

4. So what happenst to GM and citi shares in index funds?

Are the DJI index fund managers now going to dump all those shares at the same time and drive the price further down?

[joeglow3]

11. Are there very many Dow Index funds?

For those that are, I would expect the answer is yes.

[Old Hob]

5. General Motors, Citigroup to be cut from the Dow

Source: REUTERS

NEW YORK (Reuters) - The closely watched Dow Jones industrial average reshuffled the deck on Monday, removing both General Motors Corp and Citigroup Inc in a widely anticipated move.

Technology bellwether Cisco Systems Inc will replace GM, which filed for bankruptcy on Monday morning. Travelers Co , a large home, auto and commercial insurer, will take the place of Citigroup, which has taken billions of dollars from the U.S. government to stay afloat.

Dow Jones & Co said the changes will be effective as of the opening of trading on June 8.

"The parlous state of GM has left us with no choice but to remove it from the Dow. A bankruptcy filing immediately disqualifies a stock regardless of a company's history or its role as a cultural icon," said Robert Thomson, managing editor of The Wall Street Journal and editor-in-chief for all of Dow Jones in a press release.

Dow Jones said Citigroup was removed because of its "large and ongoing" government stake but added it hoped that once the bank has returned to stability it will be reconsidered for inclusion.

Cisco shares rose 3.5 percent to $19.14 and Travelers gained 2.6 percent to $41.75. Citigroup edged up 0.3 percent at $3.73, while GM tumbled 4 percent to 72 cents after being halted.



Read more: https://news.fidelity.com/news/news.jhtml?articleid=200906011022RTRSNEWSCOMBINED_TRE5503XE_1&cat=Top.Investing.RT&IMG=Y

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That's one way to bolster the DJIA, replace the bad with the not so bad but does that provide a more or less accurate view of what's happening in the stock market and in the overall economy. To me, it seems shady and typical of the smoke and mirrors style interventions that have fueled this "recovery".

[liberal N proud]

6. WOW!

GM's fall from on high.

[dixiegrrrrl]

7. Long time coming.

Now that Bush is gone, the paper house is collapsing.

[Betsy Ross]

8. That should make the average go up! LOL! n/t

[mbperrin]

13. Now you know why they do this periodically.

Numbers bad? Change the tape measure!

[madamesilverspurs]

9. Wasn't CITI

a big chunk of the Bush family portfolio?

[tomm2thumbs]

10. next they'll remove the 'D' from the Dow - Ow! nt

[prairie2]

12. I drove my Chevy to the levee and it collapsed under me

As American as mom, apple pie and Chevrolet: mom has lost her pension and health insurance; the pie filling comes from China; Chevy is bankrupt and then some. Even with GM stockholders wiped out, its bondholders getting pennies on the dollar and 70 billion in tax dollars throw in, there is no guarantee that GM will survive even as a shadow of its former self.

How could they go from being the world's largest car maker to nonexistence in only 25 years? The simple answer is Ronald Reagan. His premise was that middle class union workers were nothing more than greedy, lazy louts and a drain on the rich. We could all be rich if we let the Masters of the Universe run their businesses the way they wanted. We didn't need to make Chevy parts here; imports are cheaper and better. We didn't need to have any of those dirty factory jobs at all. High tech jobs and financial "industry" jobs were better and they would create service jobs for everybody else. Union workers became Reagan Democrats, Republican car dealers that suffered under the tight money policies of the Fed during the Carter years were happy as clams with Reaganomics. Everybody was putting their retirement into the stock market, they didn't need that stinking socialist security.

The end result is an economy so hollowed out that it could collapse entirely at anytime. Things are so bad that even Toyota has contemplated the possibility of abandoning its North American operations. Reagan Democrats are living under bridges and Republican car dealers are finding that their multi-million dollar car dealerships aren't worth a much as a bucket of warm spit. As American as Chinese apple pie. www.prairie2.com