GM’s (GM) shares are up almost 15% to over $3.25 on new hope and old rumors that the government will bailout the company. Both Obama and a number of members of Congress are pushing for Treasury to put $25 billion into the troubled car maker.
What investors may be missing is that a huge package will probably included preferred shares. GM’s current market cap is only $1.7 billion. That means common shareholders will probably be wiped out and can watch their stock go to $.25.
Douglas A. McIntyre