GM (GM) shareholders are waking up to the realisation that they really could be zeroed out.
Rather than take heart in the fact that the administration is giving the company one more chance to present a realistic turnaround scenario, they’re focusing on the fact that the administration is using the word “bankruptcy” for real.
Shares of GM are down 20% this morning, though the stock always trades wildly on news. Ford, meanwhile, is off about 5%.
As for Chrysler, its CEO Bob Nardelli probably has 30 days before he’s set to get the same treatment. If he can pull off some kind of deal with Fiat before then, the government will give the company aid. If not, expect Chrysler to go bankrupt and Nardelli to head back into retirement, where he’ll live quite comfortably on his Home Depot (HD) severance package.