Looks like the Obama Administration is administering tough medicine to the two most ailing car manufacturers, giving GM and Chrysler 60 and 30 days respectively to get their acts in order. Additionally, GM's CEO is out, reportedly at the behest of the Obama Administration. A couple of things about this.
1. The Dow will drop 500 points today as skittish investors see additional signs of the Apocalypse. Institutional investors saw this coming and have already priced this into their outlooks. The steep drop to occur today will be earned back within two weeks.
2. Unlike some, I don't see the forcing out of GM's CEO as evidence of nationalization/socialization. I think the Obama Administration has a fundamental interest in seeing that the money taxpayers have paid into this corporation is well spent on a company headed in the right direction....and if that isn't the case, making the CEO and the GM Board aware of that fact is part of their duty. As a matter of fact, I see what appears to be Obama's "letting them fail" policy as reinforcing the power of creative destruction inherent in capitalism.
On the whole, I think Obama's playing this one right.
43 minutes ago