Their Cars Are

Now so are their bonds. Reuters (05.05.05);

"Standard & Poor's on Thursday cut its ratings on about $290 billion of General Motors Corp. and Ford Motor Co. bonds to junk, jolting financial markets and further hampering the automakers as they grapple with brutal competition. The downgrades, the largest ever of their kind, sent stocks and the U.S. dollar lower, while safe-haven Treasury bond prices jumped. With junk ratings, the automakers have fewer avenues for raising funds because many large institutional investors cannot buy speculative-grade debt. These types of issuers are deemed more likely to default." S&P cuts GM and Ford to junk status

"Both companies said they were disappointed with the action."