rh13

GM Shares Just Won't Quit

There are many subtle errors in the reporting of the GM matter that have led to the impression that the shares might be worth something some day and there are apparently enough people who don't read carefully and have a dollar a share or so to spend on shares to give them some value at present. We read of the "emergence" of General Motors and of the "survival" of GM. A headline within eyesight as I write this refers to GM as "ready for a rebound." These words are serious misconceptions. The "new" General Motors has no relationship to the old General Motors, in terms of ownership or investment results. The "new" General Motors is just a collection of the assets of the old General Motors. It is owned by different people, not the stockholders of the old GM. The "new GM" owners are not offering stock for sale at present. The old GM has a new name; most of its assets have been sold, creditors are waiting for payments, and stockholders will receive something only if the creditors are paid in full. That appears unlikely, and more unlikely with each passing day. Buying the stock, when it appears fairly sure that it will be worthless soon, seems very strange to me. The old GM does not even own the brands any more, which were the only things that might have had enough value to make the stock worth anything at all.