Description

GKM pfd on bberg is a GMAC unsecured obligation that trades like an equity in the sense you can buy it w/ a regular equity account  

It has a par value of 25 and is trading around 16. 

The catalyst occurred two days ago when GMAC was the first non-investment grade issuer to issue FDIC guaranteed debt when it issued $4.5 bn. in two tranches Addittionally Uncle Sam now owns 34.5% of GMAC after providing 12 bn in aid.

All in all you are senior in the cap structure to Geithner, Bernanke & Bair Capiltal Management LLC with a 12 pct current yield and 40 pct upside to par. There is no way that this Co. files cause it is being used as the U.S govt vehicle for financing auto sales without which the GM and Chrysler plan is not going to work!   So your downside is that you get converted to common which would occur at a lower price but given the dynamics of how these conversions have been occurring you strike your equity at the low price and after that you become pari w/ the government. 

Catalyst

Two days ago que GMAC was the first non investment grade issuer to issue FDIC guaranteed debt. 

Potential for ratings upgrade FITCH Positive, S&P Developing, Moody's Developing