


For those who are on a death watch for GM and Ford, the words of CNBC's and's Jim Cramer are the kind of affirmation they've been looking for.

Yesterday, Cramer's column on addressed the increasingly dire situation for the two automakers. In one paragraph about the stunning drop in sales, Cramer wrote, "We marvel that this can be happening but the falloff in sales is so pathological that I don't see how these two just don't run out of money. "

Sounds like an obit to me.

While Cramer may know stocks, I think he's crocked on this one. Yes, I agree with him that GM's dividend is likely to disappear soon as the company moves to save cash. But, on the larger suggestion that GM and Ford will run out of cash, I don't buy it. The two automakers not only have ample cash for the remainder of '08 and the first half of '09, they haven't tapped into all the options available to them.

Would it be good for these guys to become even more leveraged? Not really. But given the choice of borrowing or going bust, I'll take borrowing any day. Yes, Ford is already on the hook for massive loans CEO Alan Mulally lined up to fund his turnaround plan. And Yes, GM has already sold many of its most valuable assets like 51 % of GMAC. That said, these two automakers are not completely out of options.

There's also the question of where sales stabilize and how quickly GM and Ford can shift production to more fuel efficient cars and crossover utility vehicles. While both are moving as fast as possible, it will still take several months for the big conversion to take place. Still, I believe these automakers have the production here and abroad to help with them at least limp through the next 6-12 months with the small cars that are selling.

So, if you buy what I'm saying and not Cramer's take, the question is where shares of GM and F bottom out? Is it possible we see Ford drop below $5 and GM skirt closer to $10?

At what point to they become a screaming buy for those betting on a rebound for these automakers? Tough questions for investors and the automakers to answer in the. Midst of the biggest crisis to hit these companies in decades.

Questions? Comments?