Only a handful of billionaires can swoop into a downtrodden stock and single-handedly rally investors to buy up shares, taking the broader stock market with them.

But sometimes, the rally tends to be short-lived.

Such was the case last week when Kirk Kerkorian announced he was doubling-up on his ownership stake in General Motors Corp. Some observers believe the move has given false hope to the struggling U.S. auto industry.

The tender offer by Kerkorian’s Beverly Hills-based Tracinda Corp. caused GM’s stock to surge 18 percent on May 4, the largest single increase for GM’s stock in 40 years. By upping his stake to 8.8 percent, Kerkorian is expected to exert more pressure on GM’s management and board, even though his company called the investment “passive.”

But one day later, a Standard & Poor’s downgrade to junk status of GM’s immense debt (along with Ford Motor Co.’s) gave the markets second thoughts on the wisdom of Kerkorian’s gambit, and the stock fell back

In truth, high-profile investors like Kerkorian, Warren Buffett and George Soros sometimes do make mistakes.

Soros made failed bets on Russia’s ruble in 1998 and on technology stocks bought by his Quantum hedge funds in 2000 losing several billion dollars. Buffett bought one-quarter of the world’s supply of silver in 1998, before prices bottomed.

*The full version of this story will be available in the May 9 edition of the Los Angeles Business Journal.