The ‘Big Three’ automakers in Detroit are begging for a government rescue. Adam Lass says these companies are just too risky to raise capital themselves. A bailout may be coming, but shareholders won’t be saved. That’s why Adam says investors should short GM (NYSE:GM) and Ford (NYSE:F).

America’s two leading auto manufacturers, Ford Motor Co. (F) and General Motors Corp. (GM), reported heavy third-quarter losses Friday and are under a severe liquidity strain. Both are seeking emergency loans from governments in the United States and Europe. 

China unveiled yesterday (Sunday) what it described as a “massive” economic stimulus package – a planned capital infusion of $586 billion that it plans to use to reverse its slowing growth, to loosen credit and to offset slowing global growth by stoking domestic demand.

Martin Hutchinson analyses what a Democrat landslide means for investors. He says nuclear and clean energy stocks, auto manufacturers, generic drug producers and muni bonds are a “buy”. But fossil fuel companies and financial institutions should be avoided.

South Korea Plans $10.8 billion Stimulus; KKR IPO Delayed Again; DryShips Posts 71% Profit Growth; Oil Slides Below $64; Manufacturing Hits 26-year Low; Viacom Profit Down 37%; Cars Sales Plummet

The U.S. Treasury Department has rejected General Motors Corp.’s (GM) request of $10 billion in assistance for its potential merger with Chrysler LLC after the Bush Administration decided it didn’t want to broaden its $700 billion financial rescue program to include industrial companies – or to play a role in a GM-Chrysler merger that could cost the U.S. economy tens of thousands of jobs, The New York Times reported yesterday (Monday).

Both the ISM Index and ISM Services reports come out this week, and it looks like the slide continues. The Index report coming out this morning is likely to show a drop to 42.0 from last month’s 43.5 reading.

The U.S. government is looking for ways to facilitate a merger between General Motors Corp. (GM) and Chrysler LLC, in the hopes of keeping the once vibrant industry afloat during a time of crisis. But Uncle Sam’s credit card is close to maxed out and a bailout for the auto industry could open the door for other troubled industries to come calling.

Pfizer Profit Triples; Kerkorian Dumps Ford; U.S. Bancorp Profit Nearly Halved; Oil Back Below $72; Avigen’s Drug Trial Mishap; OceanFreight Sails to Strong Dividend; Copper’s Costly Tumble; McClatchy’s Slack Ad Sales

Shares of Ford Motor Co. (F) and General Motors Corp. (GM) posted gains yesterday (Tuesday) on speculation that consolidation in the U.S. domestic auto industry could be the struggling sector’s saving grace.Over the last three trading sessions, Ford shares are up almost 18%, while GM shares are up over 37% on reports of possible merger talks and asset sales.