Michigan is currently a 13 point underdog to Alabama in the JerryWorld game. (Link: http://www.detroitnews.com/article/20120215/SPORTS0201/202150407/1131/Michigan-now-13-point-underdog-against-Alabama.)
Personally, even though I'm not much for bets, I'd take Michigan at those odds. Of course, I'm a shameless homer who only roots for Michigan, but I can't see them beating us that soundly.
I also believe that Michigan has an advantage in facing them at the beginning of the season. Denard should have a lot more opportunity to surprise their defense. Even though Alabama has many great incoming freshmen, it always takes a while for newcomers to make solid contributions. We'll see. Of course, it'll be interested to hear RDT's take on the game and the odds.