Wednesday, December 24, 2008

The Bank of General Motors?

Now things are getting stranger and stranger when it comes to financial news. GM just formed its lending arm into a bank holding company.

The Fed announced Wednesday that it had approved GMAC Financial Services' request to become a bank holding company. That designation makes GMAC eligible to receive a portion of the bailout fund and get emergency loans directly from the Fed.

Analysts had speculated that without financial help, GMAC would have had to file for bankruptcy protection or shut down, dealing a serious blow to GM's own chances for survival. The Fed cited "emergency conditions" in justifying its decision.

I guess you get a free tire rotation when you open a new checking account. In any case I will rather be banking with the Bank of Toyota or the First National Bank of Mercedes Benz since they will still have depositors 5 years from now. The Bank of GM is kind of iffy.

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