Dystopian Paradox

Lot’s of news and all of it’s related.

GM officially unveiled the Chevy Volt today, set to go on sale in 2010 for $40,000, about twice the price of other models of the same size. But this is a plug-in electric, designed to go 40 miles between charges. That would get most people to work and back without using any gas.

The big question is whether GM will be around in 2010. Because of the financial sector implosion, GM’s financial woes haven’t make headline news lately. GM has been burning cash like crazy and it’s going to be looking for liquidity sources before long.

Which brings up AIG. It’s got to get a lot of cash quickly or it may be heading into bankruptcy as early as tomorrow. GM may be hoping that the fed will participate in bailing AIG out as a sign that the fed will be available when GM’s number comes up.

As to the nominees take on the Wall Street sinkhole, Obama says the problem is faulty regulation of Wall Street while McCain blames it on greed. I guess the number of houses McCain and Cindy own doesn’t have anything to do with whether or not one or both of them are greedy. Maybe the only affect their wealth has on them is their seeming insensitivity to the plight of Americans who are out of work, or who do have work but can’t afford necessary healthcare.

Back to the Volt. GM isn’t expecting to make a profit on the vehicle initially. Moreover, Toyota and Honda are working on plugin electrics so the market is going to be competitive. The question is whether GM has a strategy with respect to the Volt any more rational than what has been it has always been, which is show the stockholders a profit this quarter and to heck with the future.

The strategy is different with the Volt in that it seem to include forgoing profits immediately in favor of becoming more competitive in the future. Some say it’s a big gamble for GM. It can’t be much of a gamble since GM is likely headed for the recycle bin irrespective of whether the Volt or its offspring ever shows a profit. Sources of liquidity are drying up worldwide. How much longer will China hold up the fed? Or does it have a choice?