To OTC Journal Members:
 

Can You Guess The Name of This Company From the Chart?

Here's an ugly chart. The stock recently made a new 25 year low. At one time, this was the largest company in the world. The company delivers $200 billion a year in sales, and is one of the most widely held stocks on planet earth. It has been probably been publicly traded for over 100 years, and at times has been a Wall Street darling. 

Recently there have been rumors this behemoth member of the DOW would have to file bankruptcy. At first blush you might think airline stock- the charts are similar. 

Alas- transportation, but not winged. No doubt you have already guessed if you read the headline. This is a chart of venerable General Motors (NYSE: GM). Along with Ford Motor Co (NYSE: F), the subject of a considerable recent drubbing in world markets due to lack of flexibility, foresight, and innovation.

GM and Ford have both been left with egg on their faces. Last decade's trend to the monster SUV has been replaced with this decade's trend towards the "hybrid". Toyota has been kicking their fannies in the car sales market with the Prius. They are stuck with unimaginative gas guzzlers and the belief that both companies are way behind the trend curve. This belief is reflected in the performance of their stock.

Both companies need to move, and move rapidly to the new generation of motorized transportation. High oil prices are here to stay. Consumers are responding with their purchases, and these dinosaurs need to catch up.

So, if you're GM, one of your main focuses is to get some innovative fuel saving technologies into the market now. Thanks to a lot of hard work by the company, a little luck on our part, and a little foresight, GM has entered into a relationship with OTC Journal favorite US Energy (OTC BB: USEI) to include their revolutionary new hybrid technology on diesel engines in the Far East.

Yes- that's right folks. Today, just after the market closed today, USEI announced its diesel/ng conversion technology had been selected to be included in newly manufactured vehicles at GM Thailand- considered the Detroit of the Asian market. 

There are about 1 million vehicles produced annually in Thailand, 38% of which are earmarked for export. Production is slated to begin in Q4 of '06. There were no financial terms disclosed in the press release, but one can assume GM will be paying a royalty for every vehicle produced.

So, if last week's news of the 1500 unit sales of retrofit kits didn't turn you into a believer, today's news of a deal to include their technology on newly manufactured GM vehicles in the Far East should do the trick.

I really wish this news had hit the tape a month ago before the recent market melt down. We'd be looking at a sure $.50 to $.70 on this stock in short order. The current anemic market conditions make price performance a bit less predictable.

However, let's look at a less noisy chart- this is a chart of the "weekly" stock price performance over about the last 18 months. One major positive- the volume increases since February. It the stock can achieve a 38.2% retracement towards the 2005 levels, it could trade to the $.54 level. It challenged those levels back in the Fall.

So- now it's decision time. Clearly, this news will put some life into this stock. It is big enough to perhaps bring in serious new money to the stock. If you are a short term trader, you have to consider exiting part or all on this news. If, on the other hand, you want to hold this one for the longer term, anything $.40 or below in the AM would be a heaven sent opportunity to pounce. 

A long term view in this situation seems good way to maximize your upside potential. Clearly, between the recent sale of 1500 retrofit kits, the deal with GM, and a customer list which includes UPS and the US Postal service, there are a lot of reasons to believe this technology will be adopted on a widespread basis.

The formula is simple- Skyrocketing diesel prices and supply shortages, especially in the Far East, is forcing the adoption of new technologies. USEI's technology converts a diesel engine to a hybrid that uses diesel and the far more plentiful and less expensive natural gas. The result- huge fuel cost savings with no sacrifice in performance. The "Double Bottom Line" - sales and and hopefully a major increase in stock price. 

Not often enough, but sometimes a plan just comes together.

Here's today's press release for your review:
 

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