Stocks Worthless in Bankruptcy

With all the talk about GM, Chrysler and other huge American icons filing bankruptcy, the question arises, what happens to my stock in these companies if they file? The answer, in most cases, is the stock becomes worthless. Stockholders are owners of the company. As such, they come last when a company is liquidated. Creditors get paid before owners, and only if anything is left after all the creditors are paid in full do owners get as much as a penny. Even if the company goes through reorganization, which is what many airlines did and GM and Chrysler are expected to do, very often the shareholders get almost nothing for their shares.