I had to wait till my father died before I dared buy a Japanese auto. He would not have liked to see such a vehicle sitting in his driveway. He was a General Motors man. You had to grow up in America in the 1960's to appreciate that. Earlier this month General Motors and Ford had their stock downgraded to "junk" status. That is hard to believe. Two icons of American smokestack industry have their bond rating called junk. Hard times indeed.

Most Americans don't spend a lot of time reading the financial part of the news so this story may not get a lot of attention. But it is another chapter in the story of a rapidly changing global economy. While it may not seem like anything has changed, beneath the surface there are big changes taking place. Downgrading corporate bonds to junk status is not done lightly. It takes a lot of bad management, ill will and sagging confidence for this to happen. GM could very well be on the auction block.

It is not like GM is not selling cars. They are, and in big numbers. Beyond some large fixed costs they still are bringing in large revenues. Earlier this month investment tycoon Kirk Kerkorian increased his share of GM stock. It is not hard to see why. For every dollar invested in GM it is returning more than $10 in revenue. A recent Forbes article called GM an "an old car that really needs a complete overhaul, but instead is being kept on the road with hose clamps and duct tape". GM still has value and is not to be counted out but it has some serious problems.

Yesterday The Wall Street Journal reported that Fitch credit rating agency cut its rating for Ford and Ford Motor Credit, but kept both out of "junk" status, at least for now. This was a relief but still remains a negative for the company. Ford, like GM, is hindered by relentless competition, high gasoline prices and massive health-care and pension costs. GM is waiting on what Fitch and Moody's, another major credit rating company says about its bond status.

Some feel that Toyota could buy majority ownership in GM. The two companies already have joint business ventures in America and Asia. We are seeing a reconfiguration of the American economy on multiple levels. Ownership of some of America's largest industries, those who played a significant part in its rise to a world power, would be a major shift in status. A country that loses ownership of its major companies, cannot control its economic deficits and sees its currency devalued through lack of confidence will not be in control of its destiny. By the time people wake up to this fact it will be too late.

What would my father think about that?