Tag: Analysis

What make U.S Mortgage market worsen and worsen these days? Based on information in the above two articles, I will explain the situation briefly using Fishbone Analysis.

What are the causes?

1. Public investigation of questionable foreclosure documents
2. Furor from homeowners that mortgage lenders have been evicting houses by using flawed court papers

These lead to…

1. Further suspension of foreclosures
2. Halt foreclosures

In most of the banks in the states!

Finally, the result is

1. Mortgage lenders have to keep advancing payments that will go to all mortgage bondholders instead of foreclosures.
2. Homeowners uses this advantage so they are “not willing” to pay.

In the end, Mortgage lenders don’t have enough revenue to pay the mortgage investor which eventually leads to “further losses in the already-battered $2.8 trillion market for residential mortgage-backed securities.”

I think Fishbone Analysis is quite helpful when the case are involved with so many factors. The structure of the analysis provides better overview of the case, which makes me understand the situation better.

http://online.wsj.com/article/SB10001424052748703859204575525963701140270.html?mod=rss_whats_news_us_business

Front Stage?

The government-owned automaker General Motors Co. has just announced its fuel economy development goal up to 2025 for its SUV.  Their most aggressive approach would push the fuel economy target to 62 miles a gallon (MPG), which is highly encouraged by environmentalists and Mr. Obama.

Can GM reach its goal in 2025? With an additional cost between $2,800 and $3,500 to a vehicle, GM can even reach its goal next year. Toyota, one of GM’s biggest competitors, has the prius model which gives a MPG of 51 and costs way less than GM’s future 62 MPG SUV.

http://online.wsj.com/article/SB10001424052748703882404575519773455335584.html?KEYWORDS=Toyota

Back Stage.

While GM still worries about its fuel economy, Tata Nano’s has already come up with a plan to invade Northern America’s automobile market.  Again, Toyota finds its way to save its market share from future Nano’s invasion – trying out minicars with Japan’s largest minivehicle seller on its biggest market.

GM is not only fallen behind in fuel economy, but everything. As one of Detroit’s leaders, GM should start to question itself why this happen. In my opinion, one thing that determine the difference between GM and Toyota is system.