DETROIT — Whether it’s a matter of ignorance or greed, people are still buying General Motors stock, even though the company and the government have warned that the shares will someday be worthless.
Investors are picking up millions of shares every day, likely thinking they’ll profit from what is really a hodgepodge of outdated factories and a pile of debt left behind when the new GM exited bankruptcy-court protection.
Instead, they could end up losing money very quickly. The price of the shares, currently under $1, has ratcheted up or down as much as 50 cents in one day — trading at a higher trading volume than big, viable companies such as retailer CVS Caremark, banker Capital One and consumer-products maker Procter & Gamble.
GM and federal regulators say they have done all they can to warn investors, giving old GM the appropriate moniker of Motors Liquidation Co., issuing multiple public warnings and changing the stock symbol from GMGMQ to MTLQQ.PK.
“There are people who think they are buying the new General Motors. Stop. You’re not. You’re buying the detritus,” said Harlan Platt, a finance professor at Northeastern University who follows corporate bankruptcies.
