Jan 13, 2005

More GM

Maybe it is the statement on spreads made by the CFO causing the new concerns in GM.

But Mr Feldstein said the company had found new ways of raising funds and believed it would be able to continue operating even if locked out of the unsecured bond markets.

He admitted a downgrade would initially lead to "a lot of turmoil" as bondholders unable or unwilling to invest in junk bonds were forced to sell, and the company's spreads would widen sharply - maybe to 600 basis points, from 290 today.

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