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When a market rally drags a firm's stock that has declared bankruptcy, and which has filed a plan that will result in the effective total destruction of its common stock, into the green by 20%, you know we live in looneyland.

That would be GM, which opened down at 50 cents but now is trading at 90, up fifteen cents from Friday.

Note that the common is worthless; the prepackaged bankruptcy and Section 363 sale will strip all of the value from the current GM and transfer it to the new GM.

The "old" GM will have a negative net value, which means the common stock (which represents "old" GM) is worth exactly bupkis.

Yes, this is all daytraders playing around - I get that.

But I'd like anyone to explain how GM's common stock has any value in it whatsoever, and is trading on anything more than pure hype on a big up day.

Good luck with that analysis.

Disclosure: No positions material to this idiocy.

Source: GM: Are We in Looneyland?