Five Dumbest Things on Wall Street: May 15

GM's Brass Punches Out

So much for the captains of the auto industry going down with the ship.

General Motors(GM Quote) shares traded to their lowest levels since the Great Depression this week as investors feared bankruptcy in advance of a government imposed June 1 restructuring deadline. Leading the rush to the exits was a gang of six top GM executives who unloaded more than 200,000 shares totaling around $315,000, according to a regulatory filing Monday.

A GM spokeswoman said the bigwigs waved goodbye to their holdings after the company warned that shareholders could see significant dilution if the stock swap GM announced last week was successful. GM's plan would essentially wipe out the holdings of remaining shareholders by issuing up to 60 billion new shares in a bid to pay off creditors, including a $15.4 billion loan from the U.S. government.

Oh sure, like these guys really needed the memo from GM's investor relations department that their shares were stuck in a death spiral.

The members of GM brass unloading shares at prices ranging from $1.45 to $1.61 included Vice Chairman Thomas Stephens and group vice presidents Carl-Peter Forster, Ralph Szygenda, Gary Cowger and Troy Clarke. The highest-profile executive to hit the proverbial bid was retiring Vice Chairman Bob Lutz, who disposed of 81,360 shares at $1.61 each for a total of $130,990.

Considering Lutz's full compensation in 2008 was close to $6.9 million, we were left wondering why he bothered to sell his shares at all. He could have used them as wallpaper, or even toilet paper, and never realize they were gone.

Then again, perhaps Lutz was being practical and not just plain cheap. Let's face it, the whole stock-swap idea was ludicrous in the first place, so much so that even GM CEO Fritz Henderson said on Monday that bankruptcy is the more likely option.

Either way, the change in tune from GM's board room is quite stunning. Only a few months ago the battle cry from the very same execs was that they simply needed a little cash from Uncle Sam to tide them over.

Now they are just crying uncle and cashing out.

Dumb-o-meter score: 95 -- GM's brass gets tarnished again.