G.M. CEO Wants I.P.O? NFW.

General Motors is a colony of the United States and they want their independence. Should we give it to them? I say no. According to an article by Nick Bunkley in The New York Times (8/6/10) “The chief executive of General Motors, Edward E. Whitacre Jr., said Thursday that G.M. wanted Washington to sell their entire stake during an initial public offering.” I don’t think G.M. is ready. Some colonies go on to become robust, independent nations – the United States, for instance. Others become unstable, third-world countries run by corrupt, tin pot dictators and produce nothing but terrorists. I would put G.M. in the second category.

What does G.M. gain by this proposed I.P.O? Not money. That goes to the people who sell the stock. We the people. So, what’s in it for them? “We want the government out, period,” states Mr.Whitacre. “We don’t want to be known as Government Motors.” He goes on to say that eliminating government ownership would be good for employee morale and would improve G.M.’s image. Stirring phrases of nationalism and self-determination if I ever heard them. Who thinks that Mr. Whitacre is the next Robespierre and G.M is the next France? Anyone?

Why don’t I have more confidence in G.M? Maybe it’s because they went bankrupt and didn’t change management. That before the Obama administration lent them $65 billion ($43 billion of which was converted into 61% ownership during G.M.’s bankruptcy) The Bush administration lent $20 billion, most of which is not expected to be recovered. Mr. Whitacare, of course, thinks, “our future is pretty bright.” Hinting (no figures until next week) that second-quarter earnings would surpass their first-quarter profit of $865 million. I’m sure he’s right – about the earnings. I’m sure they’ll be healthy, even glowing. What are they chances they won’t be? Figures that might be a tad more reliable show that the last time G.M reported a profit was in 2007, when the worst economy since the Depression was only starting. An economy, by the way, that usually discourages people from buying new cars. Not according to Mr. Whitacre. He claims that G.M. is scrambling to meet the demand for new Equinoxes and Lacrosses. Lacrosse? Like the Native American sport? I hope it wasn’t invented by Chief Pontiac.

Suppose The United States does grant independence to General Motors, who will manage the I.P.O? Goldman Sachs? Yeah, that’s what this country needs – to get into bed with Larry Blankfein. (Hint: He won’t respect us in the morning.) Remember, too, that I.P.O. stands for Initial Public Offering. Initial? For G.M. stock? You might as well talk about Larry King’s “initial” wife.

Don’t get me wrong. If this I.P.O. does take place, I’ll definitely need a stockbroker. Not to buy G.M. stock, but to short it.