Ok…, I was going to post about General Motors filing their IPO paperwork today but when I discovered that the old GM shares where still trading at 49 cents a share, I couldn’t help but think, ARE PEOPLE STUPID?
Sorry for being rude, but come on!
They trade on the pink sheets under the name Motors Liquidation Company (ticker MTLQQ.PK). That name sure makes you want to buy, huh? Anyone remember GM declaring bankruptcy last year?
In bankruptcies common shareholders are the LAST to get paid and ONLY IF there is anything left after paying everyone else like suppliers, bondholders, preferred stockholders… In GM’s case, unions, and even bondholders had to make concessions – GM only survived because of $70B ponied up mostly by the U.S. Government (you and me). So any guesses on what the old common shareholders will get????? Zero, nothing, nada, zilch!
The thing is that if these people were buying the stock as a collectible, that would be okay, but I would venture to say that the seven million shares that traded today were investment driven, not collectible driven.
At GiveAshare.com we still offer one share of GM stock as a collectible – note that unlike the other companies we offer, this share is not registered in your name.
We also plan on adding shares of the new GM stock when they are issued. That was to be today’s topic but I couldn’t resist.
P.S. If I have missed something and there is a valid reason for the stock to be trading at anything above zero, please comment!