It sure looks like GM may go down the tubes.
Their burn rate of available cash may not last until Obama takes office.

According to some analysts, Chapter 11, which keeps the creditors and
suppliers off their backs while they reorganize really isn't an option. Who
would buy a car from a company in bankruptcy? Furthermore, consumers have
pulled in their horns in terms of buying big ticket items in general with
concern of continued employment.

There's a 25 billion dollar government "loan" available to the auto industry
in general that is intended to help them finance the development of new,
high efficiency vehicles. Bush has recommended expediting the release of
funds associated with this loan, but is against a further "bailout" using
funds from the recent 700 billion TARP plan.

GM's burn rate is 3.1 million per *hour* and as of the end of September,
they had about 16 billion in cash.


Personally, I have very mixed feelings about this. A while back GM dropped
the Oldsmobile line due to poor sales and to cut costs. They also hinted
that another line .... either Buick or Pontiac .... would be on the
chopping block in the future if their financial situation didn't change.
That was a couple of years ago and nothing has been done.

Although it would be disastrous for the employees and suppliers for GM to
fold, I also can't see why the taxpayers should spend good money after bad.
The only way I personally could support a general bailout would be if it
were tied to a very specific and aggressive business plan laid out by GM
that would cut costs, simplify operations and overhead and otherwise provide
believable proof that the bailout money would not simply extend their
existence for a while longer while business goes on as usual. GM had the
opportunity to address their problems and have done very little to save
themselves. Their problems did not originate with September's market
meltdown.

The other problem with bailing GM out is that it sets a precedent to justify
the bailout of any company experiencing financial problems. How do you save
a job here, but let an equally important job to someone else in another
company dissolve?

Eisboch