Congratulations: You now own a 7% stake in a failing French auto company

Dear American Taxpayer and Part Owner of GM: Good news! Government Motors has now invested $400 million in junk bonds being sold by the French automatker Peugot. The worthless paper you can now light your cigars with is from a company that is bleeding red ink -- and isn't even American to boot. ABC News: In a move little noticed outside of the business pages, General Motors last week bought more than $400 million in shares of PSA Peugeot Citroen - a 7 percent stake in the company. Because U.S. taxpayers still own roughly one-quarter of GM, they now own a piece of Peugeot. Peugeot can undoubtedly use the cash.  Last year, Peugeot's auto making division lost $123 million.  And on March 1 - just a day after the deal with GM was announced - Moody's downgraded Peugeot's credit rating to junk status with a negative outlook, citing "severe deterioration" of its finances. In other words, General Motors essentially just dumped more than $400 million of taxpayer assets on junk...(Read Full Post)