danger amp in decline

I have made several forecasts on the health of AMP before and will repeat it just for the record again. AMP is in decline and in deep trouble. This is not the result of something overnight but an accumulation of overcapitalization, inefficient deployment of assets, change of policies and management styles incosistent with its needs.

The Americanization of many Australian corporations has had a similar effect with the exception of those with a character and industry type that allows for the ‘make more money take more money mentality’.

Mark my words AMP will be forced to merge with another financial institution.The Commonwealth Bank of Australia, Westpac and yes the National have held discussions. CBA seems a likely proposition with a wealthy Australian.

It is likely that a foreign insurer and or a foreign bank will also come into the picture in the end in order to diversify risk and take some of their exposure and poor performance overseas again the enigmatic wealthy Australian is a catalyst.

Like BHP managers will lose Billions and walk away with their multi million dollar handshakes. Yet no one does anything about it.

The recent profit downgrade warning was not intended to send out a message to sell, at least to institutions. It was a deliberate and calculated ploy in my opinion to send fear and panic amongst the small shareholders and to allow their favoured institutions to shore up at a discount. It is a game of musical chairs managed by AMP in much the same way they provided information selectively to favoured groups last year. I would place this company on a death watch as far as its present character as we have known it is concerned.