Posted by
Bill Crawford on Tuesday, June 02, 2009 9:28:47 PM
And the stock issues of this once great company are in the same toilet as Citigroup: the broker commission fee is worth more than the share price. A good time to buy, if you think something may come of it.
For a President who declares so often that he doesn't want to be running companies, he seems to act otherwise.
The smarter people at Treasury, if they play their cards right, will do to GM what they are trying to do with Citigroup: gradually sell off pieces until there is nothing left. The viable parts first (the Hummer division has already been bought off), and then gradually everything, in a veritable fire sale at the end.
And then GM will eventually go the way of Hudson and Studebaker, stalwarts in their day, but museum articles and memories now.
Nothing is too big to fail in a working capital market. Unfortunately, GM may be big enough to live long enough to micromanage a large part of the American car market into the ground. This administration will try and use our majority ownership to retool it as a greener manufacturer, pushing smaller, alternative powered cars on a market that may not be willing to purchase them at face value.
And because we all have deeper pockets than a smaller pool of bond holders and investors, if the technology simply isn't there yet (and it isn't), they will bore in full steam ahead anyway. They will subsidize purchases like they subsidize Amtrak, using my money to keep a venture afloat that would sink like a stone otherwise.
But because they are committed to the future of green tech (that is to say, it is a good cause), they will regard throwing tax money into this hole as a good investment.
To paraphrase Woody Allen, if you can't do, teach. And if nobody is willing to invest in you teaching, get a government job and mandate the investment. Economically speaking, we have a government filled with gym teachers trying to show us how to make the market work. This has to stop, before we turn into France.