Monday, May 16, 2005

The strike in the Finnish Paper Industry is on, and it might be anybody's guess as to how it will end.

But the most interesting part of the drama is not happening in Finland at all:

UPM-Kymmene's U.S. shares rose 25 cents to close at $19.49 in Monday trading on the New York Stock Exchange. Stora Enso's U.S. shares increased 23 cents to close at $13.04 on the NSYE.

Looks like the most important people are taking bets against the workers, in this case.


Anonymous Anonymous said...

Ahem, Puntti, if the share value increases, should't that be good for a company - and therefore, also for the workers of the company?

By the way, local p&p price indexes can be checked here. No drastic changes as of today, yet. Let's see after a week.

There has been some rumors and speculation in circulation, whether the current state of affairs in the p&p industry has been a result of long term deliberate planning, in order to 'prop up' both commodity market prices and stock values (with combined effort)? Well well, who knows. Isn't the market economy weird?

1:09 PM  
Blogger Finnpundit said...

Share values have nothing to do with worker demands. They are completely a reflection of the value potential shareholders place on a particular company.

The market's reaction could be a reflection that management's position is a strong one, and that its demands will prevail, thus striking a blow against the freeriding labor unions.

A lockout should also prop up commodity prices for the short term. Yet commodity prices do not necessarily go hand in hand with stock valuations, if such windfalls get eaten up by costly labor concessions.

It also seems to me that it is exactly the lockout that telegraphed the news to the markets, not the strike itself.

The market is a better gauge than any one individual, though, and all we can do is wait and see.

1:53 PM  
Anonymous Jussi said...

Well, I hope they stop the strike soon. My local supermarket has run out of toilet paper and kitchen paper already!

6:43 AM  

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