To GM or not?

wlben · #1 (**permalink**) 11-13-2008, 06:02 PM

I'm a newbee and have been around the auto plants all my life.
Never had any GM, Ford, or other auto related stock but with pps now below o$3 for GM I was wondering. I've ask others this question and nobody knows the answer.
If you buy a stock (such as GM or Ford) and they go into restructuring or bankrupt, the stock obviously goes to $0 and becomes a piece of paper that you can do what ever you wish with.
Now if they come back, (and they will even if they just come back with Chev. or Saturn) and the stock starts to go up in 3 to 5 years. Does it carry your stock with it and does it become worth something then?
So your $3000 for 1000 shares could become $30,000 in 5 to 10 years. Right?
Or does your stock become worthless no and ever and through out all time?
Thanks.
w.

xenforlife · #2 (**permalink**) 11-14-2008, 02:22 AM

that's the question you have to ask. they won't go bankrupt i don't think because the government will bail them out, being American and all

but what that will do to your stock is speculation, but most probably i would think it wouldn't be good. too risky for me, because those companies are losing too much money...

it's a long shot, but it's true if they do return you could make a huge pay-off. more risk=more reward

brian · #3 (**permalink**) 01-17-2009, 03:15 PM

Quote:

Originally Posted by xenforlife

more risk=more reward

Exactly right - when Fannie Mae and Freddie Mac stock tanked, I bought a number of shares in both companies, speculating that over 5-20 years the shares would regain significant value.

However, it didn't form a major part of my investment strategy, but merely an opportunity I wanted to explore on top of my existing investment strategy.

IntelligentInvestor · #4 (**permalink**) 05-30-2009, 01:22 PM

well if you have some money to burn and like betting than GM is for you. GM is about to go bust and bearly have any assets (after you deduct liabilities), why would you invest your own money in such a venture? Even governments are not ready to gamble with them.

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