General Motors (GM) Indicator


General Motors (GM) Indicator
An indicator based on the theory that the performance of U.S. automaker General Motors (GM) is a pre-cursor to the performance of the U.S. economy and stock market. The GM Indicator relies on the assumption that when people are confident and making money one of the first things they would do is buy a new car.

There is still some talk behind this strategy as there is a correlation between auto sales and the overall economic standing of individuals. But this theory had more weight in the 1970s-80s when GM was by far the largest carmaker in North America. Since then GM's importance to the U.S. economy has declined due to greater competition.

During the financial crisis of 2007/2008, GM saw sales decline due to a decrease in demand for their "less" fuel efficient vehicles, and a decrease in available funds for financing due to credit restrictions. Their stock price dropped over 70% compared with a general market decline of around 30%. Although a correlation exists, the overall market and economy relies less on the performance of one automaker than it did in the 1970s.


Investment dictionary. . 2012.

Look at other dictionaries:

  • Economic Affairs — ▪ 2006 Introduction In 2005 rising U.S. deficits, tight monetary policies, and higher oil prices triggered by hurricane damage in the Gulf of Mexico were moderating influences on the world economy and on U.S. stock markets, but some other… …   Universalium

  • Business and Industry Review — ▪ 1999 Introduction Overview        Annual Average Rates of Growth of Manufacturing Output, 1980 97, Table Pattern of Output, 1994 97, Table Index Numbers of Production, Employment, and Productivity in Manufacturing Industries, Table (For Annual… …   Universalium

  • Toyota — Infobox Company company name = Toyota Motor Corporation Toyota Jidosha Kabushiki gaisha トヨタ自動車株式会社 company Moving Forward company type = Public (tyo|7203) foundation = 1937 founder = Kiichiro Toyoda location = Aichi, Nagoya and Tokyo, Japan key… …   Wikipedia

  • Oldsmobile — Industry Automotive Fate Dissolved Founded August 21, 1897 Defunct April 29, 2004 Headquarters …   Wikipedia

  • Mini — For the Mini marque, see Mini (marque). For other uses of Mini , see Mini (disambiguation). Mini Manufacturer BMC to MG Rover, and Innocenti …   Wikipedia

  • Diesel locomotive — Three styles of diesel locomotive body: cab unit, hood unit and box cab. These locomotives are operated by Pacific National in Australia …   Wikipedia

  • Chevrolet Vega — 1972 Chevrolet Vega GT Hatchback Coupe Manufacturer Chevrolet Division of General Motors Also called Vega 2300 …   Wikipedia

  • Chevrolet Cruze — Manufacturer General Motors Also called Daewoo Lacetti Premiere Holden Cruze Production 200 …   Wikipedia

  • Fire alarm control panel — A fire alarm control panel (FACP), also called a fire alarm panel. Technicians usually refer to the FACP as the panel. A fire alarm control panel is the central control device that receives information from input devices (smoke detectors, heat… …   Wikipedia

  • Isuzu D-Max — Not to be confused with DMAX engines, produced by the General Motors Isuzu joint venture. Isuzu D Max Manufacturer Isuzu General Motors …   Wikipedia


Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”

We are using cookies for the best presentation of our site. Continuing to use this site, you agree with this.