Are You Going To Buy Their Stock Now? GM Posts Strong Profits Ahead Of IPO

GM's "creative bookkeeping" is entirely legal. The US Government's (AKA Tax Payers') purchase of several hundred million shares of GM stock at waaaay above market value infused a huge amount of cash into GM. So yes, this represents "profit" (while GM's losses were tranferred to those shareholders whose stock, at market value, is worth a tiny fraction of their book value).

The issue with GM's "profitability" is that it did not come about from sound business practices, but rather, from the huge cash infusion from a rather extraordinary deal. One which hopefully will not become a regular practice in the future. After the dust settles, we'll still be dealing with GM, and the issues that brang them to the Hand-Out Trough in the first place.

No thanks to GM shares. YMMV.

Hah! If I had $50K to throw down the drain it would be a hard choice between buying GM shares or a Hyundai Equus - both will have no value in 5 years.

I would go with the Equus, given that you can at least drive that a few hundred miles at a minimum.

If I don't believe(buy) in GM products, why would I buy their stock?

Until GM has demonstrated that they have learned from their mistakes, I will not voluntarily give them anymore of my money.

There is a story that was told a few years ago by an executive of a company that was in serious trouble. The company stocks were plummeting and they called a shareholders meeting to discuss the way forward. After the executives had put the doomsday forecast on the table they asked if there was anything that the shareholders wanted to say. A little old lady (with hand bag a-la Sophia Petrillo) stood and walked to the podium. She declared that she watched the stocks drop day after day and the more it dropped, the more stocks she bought. At that point she was scheduled to be the majority share holder and was there to advise all the shareholders to have faith in the company. She made suggestions that gave that company a turnaround and it's still in operation today. I'll leave the name of the company out for now. So, to answer the question, if I had the money I would buy GM stock until I heard a voice say "buy no more". I'd law down the real rules up in there and make the necessary (unpopular?!?) decisions necessary to get things back on track.

Be aware even if this IPO is successful the government is still going to own 2/3 of GM.