Comments follow downgrade sending ratings deeper into junk territory

NEW YORK - A bankruptcy by General Motors Corp. is not "far-fetched" if present trends at the company persist, Standard & Poor's said Monday, shortly after cutting world's largest automaker's ratings deeper into junk territory.

The downgrade and S&P's comments initially sent GM shares and bonds lower as investors fretted about the rising risk that the company will have trouble repaying its debt.

"In the past, we might have felt at different points that the concerns about bankruptcy risk were way overplayed," said Scott Sprinzen, speaking on a conference call with reporters and analysts.

Full Story: http://www.msnbc.msn.com/id/10442399/

its not a bad idea... its a great idea, except for the PR that goes with it... people dont understand that Chapter 11 is a releif stratagy for the company, and its what GM could really use right now...

its not a bad idea...

its a great idea, except for the PR that goes with it... people dont understand that Chapter 11 is a releif stratagy for the company, and its what GM could really use right now...

[post="58153"]<{POST_SNAPBACK}>[/post]

That's what I'm thinking. It's horrific for image, but pretty good for the business as a whole.

Filing for Chapter 11 isn't a surprise if you're burning cash at a $5bn a year rate. What's going to be interesting to follow is how well GM executes their capacity reduction plans in NA and, more importantly on a long-run perspective, their globalised product development strategy. Congrats on the Solstice, btw! :)

The key to their rating is the part where they say that "if they have repeated quarters like the previous 2". The previous 2 quarters were bad of historic proportions. It's not like every two quarters is going to have another Fiat fiasco. Another 'sky is falling' article. One might note that GM filing bankrupcy would allow GM to escape some of their contractual obligations & perhaps shed a portion of their pension debt. What investor wouldn't like to hear that?

The key to their rating is the part where they say that "if they have repeated quarters like the previous 2".  The previous 2 quarters were bad of historic proportions.  It's not like every two quarters is going to have another Fiat fiasco.  Another 'sky is falling' article.  One might note that GM filing bankrupcy would allow GM to escape some of their contractual obligations & perhaps shed a portion of their pension debt.  What investor wouldn't like to hear that?

[post="58167"]<{POST_SNAPBACK}>[/post]

So now it's even OK to go BK. Ladies and Gentlemen, IT'S TIME TO...

WAKE UP

On a sweltering summer day, an old man went down into a cool cellar for some relief. The moment he entered, he was blinded by the darkness. Don't Worry, said another man in the cellar, it is natural that when you go from light to darkness, you're unable to see. But soon enough, your eyes will grow accustomed to it, and you will hardly notice that it is dark.

My dear friend, replied the old man, turning to leave, that is exactly what I am afraid of. Darkness is darkness, the danger is convincing your self that it is light.


As I said everyone should wake up as each day goes by Wagoner is piling dirt on the exit from the cellar. I.E. everyone is in they dark, they just think it's light.

So now it's even OK to go BK. Ladies and Gentlemen, IT'S TIME TO...

WAKE UP

On a sweltering summer day, an old man went down into a cool cellar for some relief. The moment he entered, he was blinded by the darkness. Don't Worry, said another man in the cellar, it is natural that when you go from light to darkness, you're unable to see. But soon enough, your eyes will grow accustomed to it, and you will hardly notice that it is dark.

My dear friend, replied the old man, turning to leave, that is exactly what I am afraid of. Darkness is darkness, the danger is convincing your self that it is light.
As I said everyone should wake up as each day goes by Wagoner is piling dirt on the exit from the cellar. I.E. everyone is in they dark, they just think it's light.

[post="58186"]<{POST_SNAPBACK}>[/post]

i've heard that before...

but, i guess we can start talking about how horrible wagooner is...

Really though I'd like to discuss some of the pros and cons to Chapter 11...

Buickman, you just lost me with repeating that comment and I just lost my shorts from laughing so hard. I thought that little story was pretty good when I first read it because it makes sense to an extent. Unfortunately, you repeated it and now it's just a joke.

LMFAO!!!!!!!!!!!!!!!!! I can't stop laughing!!!!!!

right now is looking more and more like the time to buy stock.... I don't think investors would be happy at all with bankruptcy, since they will end up losing value

Edited December 14, 200520 yr by turbo200

I think buying stock would be kinda risky. What was it 280+/- billion in debt ? Loosing money to boot. Better be one hell of a plan. Are they going to bribe the media to stay off their back ? Are they going to convince the population that their cars really are not junk ? Ive tried and cant do it, on a GM site no less. I can see it now in 2008, MT - "This new GM BRK isnt too bad comming from a company thats Bankrupt." That'll boost sales. "sciguy" - Im not sure where else Buickman posted that short story but perhaps he posted it here as well because we all dont read each and every post. Perhaps you have something to add to the topic of the post ? Perhaps you have a story of your own you'd like to share, that relates to this topic ?

GM's marketshare would take an immediate nosedive with little chance of recovery if they filed for bankruptcy and their image would be tarnished for decades. It's not going to happen.

I think buying stock would be kinda risky. What was it 280+/- billion in debt ? Loosing money to boot.

Better be one hell of a plan. Are they going to bribe the media to stay off their back ? Are they going to convince the population that their cars really are not junk ? Ive tried and cant do it, on a GM site no less.

I can see it now in 2008, MT - "This new GM BRK isnt too bad comming from a company thats Bankrupt." That'll boost sales.

"sciguy" - Im not sure where else Buickman posted that short story but perhaps he posted it here as well because we all dont read each and every post. Perhaps you have something to add to the topic of the post ? Perhaps you have a story of your own you'd like to share, that relates to this topic ?

[post="58342"]<{POST_SNAPBACK}>[/post]

I don't read each and every post, either, razor. I think that's the job of the moderators. As you may have noticed, even if you do not read each and every post, is that I already added what I wanted to.

if bankrupsy wasnt far-fetched... kirk wouldnt have his money at stake... it wont happen...