What We're Hearing

Stop the presses: Not only did GMAC Financial Services earn a (small) profit in the first quarter, but its residential mortgage unit did as well. But wait: the chief reason, Residential Capital Corp. made money was because it extinguished debt. Don't forget that ResCap is on the auction block -- and there's all sorts of speculation that buyers aren't exactly lining up around the block to make a bid on the thing. (Its investment banker is the trustworthy Goldman Sachs.) Also, its loan production fell 26% in the first quarter compared to the fourth. Compared to 1Q 09, production was relatively flat. And, of course, there's been plenty of job cuts at ResCap as well. Who says you can't cut your way to profitability? As for Uncle Sam getting its $15 billion back, stay tuned. And what about Cerberus' $15 billion?...