Bail out Citigroup; What about GM?

OK, this article is not about Citigroup and the bailout announced today. I don't have an opinion on that. Well, I do, but not a strong one: I think the government should bail them out in return for full control, then split it up and sell off the parts. That's what the government should have done with AIG and that's what the government should probably do with Fredi and Fanny.

Currently, from what I read the bail out isn't a good idea. The government puts a huge amount of cash into an organization which is horribly managed and in returns gets grants to buy shares at 10 dollars, where the current share price is 3 dollars.

The real point I would like to make is for the people who ask "If the government bails out AIG, and Citigroup, and Whoever, why don't they bail out GM?".

The answer is, I think, fairly strait forward. If the government took any of the companies it is bailing out, it could divide and sell them. Most of the segments would make money. If the government took Ford, GM, or Chrysler and divided them (with the exception of GMAC) nothing would be worth a penny.

Lets get this strait: Chrysler was GIVEN to Cerberus Capitol by Daimler. Actually, Daimler paid Cerberus Capitol to TAKE Chrysler off their hands. So, next time a company pays money to give another company a segment of there business you know things aren't going well.

Ford just sold its last remaining valuable asset (30% of Mazda). GM, GM doesn't have anything except Hummer. They have been trying to give that away, no takers; no wonder.

Infact, the only way GM has been making money over the last few years is as a bank (essentially) via GMAC.

On the other hand, AIG, Citi, and even Lehman Bros were fairly profitable companies in areas where there was demand. Their problem(s) stem from a collapse of confidence, and bad loans. Some of their problems are bad loans, some is bad confidence. Take away the confidence and the bad loans might hurt these companies by about 20% of their market value. (plus other macroeconomic factors which are at play now). Government acquisition would just remove the confidence problem, breaking them up and selling them (maybe in a year or two) would probably be very profitable for the government.