York was called many things during those times

Moody's said GM's current stash of $24 billion in cash and $7 billion more in quickly accessible credit "affords the company with ample flexibility to contend with market downturns and other operational stress."Good thing, because the past decade showed how rapidly a huge auto company can burn through cash when it becomes too smug about its own rosy projections and too slow to respond when the house is on fire.In January 2006, the late Jerry York — who was then stirring the pot at GM on behalf of activist investor Kirk Kerkorian — said GM was burning through cash at the rate of $24 million a day and predicted it would run out in about 1,000 days.

York was called many things during those times, but nobody ever accused him of being bad at counting. GM collapsed into the arms of U.S. government 1,074 days later.York had urged several moves to stem the bleeding,Fashion Dresses including cutting the shareholder dividend in half. Unbelievably in retrospect, GM had the highest ratio of dividend to stock price of any company in the Standard & Poor's 500 index, until it finally did slash the dividend a month after York's big 2006 speech.Ominous warnings about GM's financial assumptions had come years earlier from others, including my Free Press colleague Susan Tompor.

In a 2002 column, two years after the dot-com bust had ushered in a bear market for stocks, Tompor pointed out that GM was still assuming a rosy 10% return on its pension fund assets — even though investment guru Warren Buffett had publicly raised a red flag about such high expectations.General Electric had already cut its pension fund return forecast to 8.5%, but GM didn't budge until long after most other companies got more conservative.I resurrect this unpleasant history not to throw cold water on the new GM's impressive comeback, but merely to caution about the devious way success has of going to one's head.

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