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GM's Profits are Still a Huge Net Loss For Taxpayers - Megan McArdle - Business - The Atlantic
This is a good story and a very bad event.
The GOP is going to have a field day with this stuff in 2012But of course, that assumes that the current share price holds. It could well fall over the next few months--or when the government dumps an enormous new supply of GM stock on a market that isn't showing all that much enthusiasm for the product.
Could also become more valuable.
GM paid back the loan. The government still has equity in the company.
^Neither of those is a lie.
Really? Do you have newer Information
General Motors Repays $8.1 Billion in Government Loans - ABC News
GM Pays Back TARP Loans With...TARP Loans! - Hit & Run : Reason Magazine
Not so much
For those keeping score at home, I was actually hoping the government would sponsor an organized wind-down of GM an Chrysler over a long period of time - an orderly selling of assets etc...
And why exactly would they do that..
To provide those assets to companies that can use them more efficiently (by selling them) while proving the shareholders with a fair price for their assets (by winding down over a long period)
As did I. So let me get this right you're saying that by giving GM an unfair advantage of Billions in operating capital it helped Ford Survive? Is that really what you're trying to suggest?
Suggest?
That's exactly what happened.
The executive board at Ford would tell you the very same thing.
That WOULD have happened had GM collapsed, but we all know that bankruptcy doesn't mean collapse.
The US took about 61% of GM's stocks and paid about $50 billion for it
Today's price of GM stock is about $31 per share'
Todays price cap is about $48.49 Billion so today, theoretically the Govs stocks are worth .61x $48.49 Bil = $29.5 Bil.
Not a very good investment but way way WAAAAAAAAAAAAAAAAAAAAAAY better the most of the so call bailout "investments" they made to the various Banks, Insurance companiesm hedge funds etc, who were the CAUSE of this crises.
There basically, both Bush II and Obama took on the banksters debts in a series of complex deals where the banks basically get the profits while the government takes on all the risk.
If you want a very clear idea of how much SOCIALISM we gave to the BANKSTERS (and how little we gave to the people who really needed help that were screwed by aforementionsed Banksters), you might consider reading either Stiglet's books "FREEFALL" or Krugman's Book the GREAT UNRAVELING
If those tomes don't thoughly burn your capitalism loving buns, you either have the patience of a saint or you are a Bankster laughing all the way to (and in) the bank.
GM paid back the loan. The government still has equity in the company.
^Neither of those is a lie.
Really? Do you have newer Information
General Motors Repays $8.1 Billion in Government Loans - ABC News
GM Pays Back TARP Loans With...TARP Loans! - Hit & Run : Reason Magazine
Not so much
I think 8537 has just told us something about how he manages his own finances.
And why exactly would they do that..
To provide those assets to companies that can use them more efficiently (by selling them) while proving the shareholders with a fair price for their assets (by winding down over a long period)
If the government is seizing the company, the fair price to shareholders is $0.
There was no reason to wind down GM and Chrysler. What they needed was to restructure the cost base, which they did. With a restructured cost base, the company can continue to operate. It makes good products.
The government bailout stunk to high heaven, since it put wages owed to workers above creditors in the capital structure, an odious payback to Obama's buddies that egregiously circumvented the legal rights of those with claims on the companies.
The bailout will probably wind up being a bad decision. Unfortunately, the bankruptcy occurred in the middle of the financial crisis. With the world seemingly collapsing around us, the government felt it necessary to contain the downward spiral and save the car companies.
