Friday, July 02, 2010

Call it "The McDonald Effect"...

11 comments:

Anonymous said...

Wonder if one of the financial wiz kids will build a virtual portfolio of gun companies and track their performance for a while.

Couple decades back the prediction was gun outfits were on the Chapter 7 slope; interesting how it's turned around, and I suspect we'll see a long term upward trend.

Tam said...

In the short term, gun companies are good, because worried people in a sour economy tend to stock up on things like guns and freeze-dried food and gold coins and whatnot because it makes them feel safe and prepared.

I think in the long term, any gun company that doesn't have its manufacturing facilities in a low-tax right-to-work state is looking at a pretty serious achilles heel. It killed Colt and Winchester and will eventually kill S&W, too.

LL said...

Firearms manufacturers need to devolve into states that are firearm friendly. I can't agree more that leaving the East Coast is in their best financial interests. If the people don't want the jobs and incomes in their states, states who want them to set up shop need to woo them with tax incentives to attract them.

Frank W. James said...

Tam: Smith & Wesson is still a non-union company. Colt isn't. Big difference even in an east coast/gun valley atmosphere.

All The Best,
Frank W. James

Tam said...

I did not know that.

Bubblehead Les. said...

Wonder how the Ammunition companies are doing?

Tam said...

Well, Olin was down slightly yesterday, and they're down again slightly so far today.

Crucis said...

Olin makes powder. One plant was just "down the road" from my while in college. It didn't follow the firearms trend. Perhaps that only applies to firearm manufacturers not ammo makers.

Olin (Winchester) operates the Lake City Arsenal here near KC. The LC ammo is boxed by Federal.

Confusing, not?

SteamshipTrooper said...

Tam and Frank are absolutely right. The stock markets (not the free markets :) are driven by fear, hope and earnings. SWHC is getting a short boost from the first two.

For fun, go look at the charts of SWHC and RGR for 2008-2010. Interesting date correlelation?

Will said...

Traditionally, Colts biggest problem for probably its entire history is bad management. Seems to be a built-in problem, in addition to the labor issue. When a gun company looses money during a world war, they have to have major stupid at the controls.

I have a vague recollection that it is used as a case study in how NOT to run a business.

Ed Foster said...

Worked at Colt. Worked at Smith and Wesson.
Colt, best damned engineering department I ever was part of. Screwed by the UAW, may they rot in hell.

Smith, great people, very political. Everybody in the place is looking over his shoulder for the Commissar.

When I went there, stock value was $15. When I left, it was $3. The people in the holding company all sold at the peak, while telling everyone it would keep going well up into the $20's. Hustlers, like the harpies who took over Colt after the strike.