From the September 30, 1916, edition of The Economist:
A Boston correspondent writes: Bethlehem Steel’s amazing market rise has been eclipsed. This week General Motors stock sold at $697 per share, the highest price at which any stock ever has sold on the New York Stock Exchange, with the exception of Northern Pacific. The latter issue sold on one occasion at the record price of $1,000 per share, but this was a forced price during the corner of 1901. The record high price for a stock on the Boston market is held by Calumet and Hecla, which brought $1,000 per share in 1907. The stock market career of General Motors stock has been spectacular in the extreme, surpassing even the rise of Bethlehem Steel. In 1913-14 it sold as low as $25 per share; for many months after the market soared as a result of munition and motor orders, it lagged behind other issues of its class. Even in 1915 it sold for only $82 per share. Then it began to advance under steady buying, and its low point for the present year never went below $405. The advance on September 12th last was an experience to which even old-time traders were unused. The stock rose $52 for the day. Just by way of comparison, Bethlehem Steel, hitherto the premier war stock, gained 24Â½ points the same day, to 524Â½, a new high record. Next day General Motors rose $55 per share, to $697, making a gain of $107 for two days, and Bethlehem Steel gained $30Â¾, to $555, per share, a rise of $55Â¼ for the two days. The General Motors Company has under way a recapitalisation plan that calls for a 400 per cent stock dividend on the common, equivalent to five shares of non-par value stock for each share of the present capital stock.
If you have access to LexisNexis, there is a fascinating article how the United Auto Workers will sign a radically reformed contract to save the American auto industry. 2001: A union odyssey. (1985). Newsweek, August 5, pp. 8, 50-54. From the article published a generation ago:
The United Auto Workers took on a strong semblance of the union of the future last week when it agreed to a contract for the new General Motors Corporation Saturn plant, where GM will try to build small cars at a profit. The UAW agreed to a drastic reduction in the number of job classifications at the plant, allowing each worker to perform several tasks. And once the plant is in full production, the workers will make just 80 percent of the industry wage — with the gap potentially filled by pay based on such things as profit at the plant and product quality. In return, the workers will have a voice in making decisions from the shop floor on up and an unheard-of measure of job security. The initial Saturn employees will be guaranteed jobs for a lifetime; 80 percent of those hired subsequently will get that guarantee.
The UAW’s approach is a far cry from the “solidarity forever” activism of 50 years ago, when many people saw the union movement as the vanguard of social transformation, but labor may have no choice but to change. “The unions can adapt to the new concepts and prosper,” says David Cole, director of the Office for the Study of Automotive Transportation at the University of Michigan, “or they can disappear.”
GM is a company whose best days may have been 90 years ago. GM and her union have been talking about wrenching changes for a generation. Nothing comes of it. The bad actors (shareholders and unionists) are rewarded, against and again, by the federal government in the form of bailouts, protectionism, and hidden subsidies.
Let GM go bankrupt.