DETROIT – There’s a big bailout fight brewing in Washington D.C. over aid to the automotive industry. President Bush told Democratic leaders he’d be interested in some horse trading. The New York Times reports he�??ll provide aid to the auto industry, providing Democrats approve a free trade deal with Colombia. The Democrats are saying, “No dice.” And so the drama builds.
Adding to the tension, Deustsche Bank says GM stock will drop to zero even if the company gets a bailout. It predicts three scenarios: One, GM restructures down to only three brands in the American market. Two, the government forces GM lenders to take a loss while the feds take an ownership position in the company. Three, GM declares bankruptcy, but the government provides the cash to keep operations going.
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