U.S. to lose $25 billion on auto bailout

[beretta304]

Treasury: U.S. to lose $25 billion on auto bailout

By David Shepardson
Detroit News Washington Bureau

Washington -The Treasury Department says in a new report the government expects to lose more than $25 billion on the $85 billion auto bailout. That's 15 percent higher than its previous forecast.

In a monthly report sent to Congress on Friday, the Obama administration boosted its forecast of expected losses by more than $3.3 billion to almost $25.1 billion, up from $21.7 billion in the last quarterly update.

The report may still underestimate the losses. The report covers predicted losses through May 31, when GM's stock price was $22.20 a share.

On Monday, GM stock was trading down 6 cents, or 0.2 percent, to $20.49. At that price, the government would lose another $850 million on its GM bailout.

The government still holds 500 million shares of GM stock and needs to sell them for about $53 each to recover its entire $49.5 billion bailout.

Treasury spokesman Matt Anderson said the costs were still far less than some predicted.

"The auto industry rescue helped save more than one million jobs throughout our nation's industrial heartland and is expected to cost far less than many had feared during the height of the crisis," Anderson said.

The Obama administration initially estimated it would lose $44 billion on the bailout but reduced the forecast to $30 billion in December 2009.

Republican presidential candidate Mitt Romney has decried the losses on the auto bailout and insisted that forcing GM and Chrysler Group LLC to go through bankruptcy first would have saved taxpayers money.

But President George W. Bush — who gave the automakers and their finance arms about $25 billion in his final weeks in office in bailout funds — said there wasn't time.

Taxpayers incurred a $1.3 billion loss on the $12.5 billion bailout of Chrysler.

The Treasury also has put on hold an initial public offering initially planned for last year in Ally Financial Inc. because of market weakness. The government holds a 74 percent majority stake in the Detroit auto finance company as part of its $17.2 billion bailout and has recovered $5.7 billion.

GM CEO Dan Akerson told employees at a town hall meeting Thursday that the company was working to take actions to boost the automaker's sagging price.

[email protected]



From The Detroit News: Treasury: U.S. to lose $25 billion on auto bailout | The Detroit News | detroitnews.com

 

[Soggy in NOLA]

Gee... who'd a thunk that letting a cabal of classroom theoreticians and Marxists tinker with a bankrupt corporation with a bad business model would turn out poorly?

 

[NYcarbineer]

So the worst case scenario is that we saved 2 American industries at the cost of 3 months worth of Iraq war?

That makes the argument that instead of going into Iraq in 2003, we should have started saving US businesses.

btw, I wonder if they count the tax revenue generated by the saved jobs at GM when they make that calculation?

 

[Leweman]

"btw, I wonder if they count the tax revenue generated by the saved jobs at GM when they make that calculation?"

It saved nothing ... Go learn something about bankruptcy, moron.

 

[Clementine]

Treasury: U.S. to lose $25 billion on auto bailout

By David Shepardson
Detroit News Washington Bureau

Washington -The Treasury Department says in a new report the government expects to lose more than $25 billion on the $85 billion auto bailout. That's 15 percent higher than its previous forecast.

In a monthly report sent to Congress on Friday, the Obama administration boosted its forecast of expected losses by more than $3.3 billion to almost $25.1 billion, up from $21.7 billion in the last quarterly update.

The report may still underestimate the losses. The report covers predicted losses through May 31, when GM's stock price was $22.20 a share.

On Monday, GM stock was trading down 6 cents, or 0.2 percent, to $20.49. At that price, the government would lose another $850 million on its GM bailout.

The government still holds 500 million shares of GM stock and needs to sell them for about $53 each to recover its entire $49.5 billion bailout.

Treasury spokesman Matt Anderson said the costs were still far less than some predicted.

"The auto industry rescue helped save more than one million jobs throughout our nation's industrial heartland and is expected to cost far less than many had feared during the height of the crisis," Anderson said.

The Obama administration initially estimated it would lose $44 billion on the bailout but reduced the forecast to $30 billion in December 2009.

Republican presidential candidate Mitt Romney has decried the losses on the auto bailout and insisted that forcing GM and Chrysler Group LLC to go through bankruptcy first would have saved taxpayers money.

But President George W. Bush — who gave the automakers and their finance arms about $25 billion in his final weeks in office in bailout funds — said there wasn't time.

Taxpayers incurred a $1.3 billion loss on the $12.5 billion bailout of Chrysler.

The Treasury also has put on hold an initial public offering initially planned for last year in Ally Financial Inc. because of market weakness. The government holds a 74 percent majority stake in the Detroit auto finance company as part of its $17.2 billion bailout and has recovered $5.7 billion.

GM CEO Dan Akerson told employees at a town hall meeting Thursday that the company was working to take actions to boost the automaker's sagging price.

[email protected]



From The Detroit News: Treasury: U.S. to lose $25 billion on auto bailout | The Detroit News | detroitnews.com

But, but, one of Obama's slogans (and left talking point) is that GM is alive. Glad we could keep the company afloat for the wealthy unions even though it means we lose our ass. Hell, we lost money on Solyndra and a bunch of other green companies. Ain't throwing away money fun? It is when it's not yours you are playing with.

 

[Sinjorri]

So the worst case scenario is that we saved 2 American industries at the cost of 3 months worth of Iraq war?

That makes the argument that instead of going into Iraq in 2003, we should have started saving US businesses.

btw, I wonder if they count the tax revenue generated by the saved jobs at GM when they make that calculation?

if thats the case, the iraq war saved lives, dont dems like saving lives? And by lives i mean pretty things, they are never out saving the tazmaian devil

Tasmanian Devils Named Endangered Species


but thats a whole other debate. But if the iraqi war can be saving lives, isnt that money well spent?

 

[eflatminor]

So the worst case scenario is that we saved 2 American industries at the cost of 3 months worth of Iraq war?

That makes the argument that instead of going into Iraq in 2003, we should have started saving US businesses.

btw, I wonder if they count the tax revenue generated by the saved jobs at GM when they make that calculation?

1) We didn't "save" anything. Bankruptcy has been a viable option for thousand of companies that emerged healthier.
2) The cost of war is non sequiter. Regardless of what we spend on military, it does not justify the bailouts.
3) We did create a tremendous moral hazard.
4) We did screw over the bondholders
5) We did screw over GM's competitors who could have taken market share.

 

[Jarhead]

So the worst case scenario is that we saved 2 American industries at the cost of 3 months worth of Iraq war?

That makes the argument that instead of going into Iraq in 2003, we should have started saving US businesses.

btw, I wonder if they count the tax revenue generated by the saved jobs at GM when they make that calculation?

on the flip side...do they include the loss of government revenue with the Cash for clunkers deal that helped generate the sales for the industry.

 

[amrchaos]

Why not keep the stock and let the interest on them help pay for the bailout.

Better to hold than sell at a lost anyway. GM is not going any where so holding until the stock rises again seems like a good policy here.

 

[Vel]

Treasury: U.S. to lose $25 billion on auto bailout

By David Shepardson
Detroit News Washington Bureau

Washington -The Treasury Department says in a new report the government expects to lose more than $25 billion on the $85 billion auto bailout. That's 15 percent higher than its previous forecast.

In a monthly report sent to Congress on Friday, the Obama administration boosted its forecast of expected losses by more than $3.3 billion to almost $25.1 billion, up from $21.7 billion in the last quarterly update.

The report may still underestimate the losses. The report covers predicted losses through May 31, when GM's stock price was $22.20 a share.

On Monday, GM stock was trading down 6 cents, or 0.2 percent, to $20.49. At that price, the government would lose another $850 million on its GM bailout.

The government still holds 500 million shares of GM stock and needs to sell them for about $53 each to recover its entire $49.5 billion bailout.

Treasury spokesman Matt Anderson said the costs were still far less than some predicted.

"The auto industry rescue helped save more than one million jobs throughout our nation's industrial heartland and is expected to cost far less than many had feared during the height of the crisis," Anderson said.

The Obama administration initially estimated it would lose $44 billion on the bailout but reduced the forecast to $30 billion in December 2009.

Republican presidential candidate Mitt Romney has decried the losses on the auto bailout and insisted that forcing GM and Chrysler Group LLC to go through bankruptcy first would have saved taxpayers money.

But President George W. Bush — who gave the automakers and their finance arms about $25 billion in his final weeks in office in bailout funds — said there wasn't time.

Taxpayers incurred a $1.3 billion loss on the $12.5 billion bailout of Chrysler.

The Treasury also has put on hold an initial public offering initially planned for last year in Ally Financial Inc. because of market weakness. The government holds a 74 percent majority stake in the Detroit auto finance company as part of its $17.2 billion bailout and has recovered $5.7 billion.

GM CEO Dan Akerson told employees at a town hall meeting Thursday that the company was working to take actions to boost the automaker's sagging price.

[email protected]



From The Detroit News: Treasury: U.S. to lose $25 billion on auto bailout | The Detroit News | detroitnews.com

But hey.. Obama says he wants to do to ALL industries what he's done to the auto industry. Good times folks.. good times

 

[Jarhead]

So the worst case scenario is that we saved 2 American industries at the cost of 3 months worth of Iraq war?

That makes the argument that instead of going into Iraq in 2003, we should have started saving US businesses.

btw, I wonder if they count the tax revenue generated by the saved jobs at GM when they make that calculation?

1) We didn't "save" anything. Bankruptcy has been a viable option for thousand of companies that emerged healthier.
2) The cost of war is non sequiter. Regardless of what we spend on military, it does not justify the bailouts.
3) We did create a tremendous moral hazard.
4) We did screw over the bondholders
5) We did screw over GM's competitors who could have taken market share.

As for number 4.......I still dont get why there was no outrage over that.
As for number 5.....Ford did it right....and they walk away as the losers. Go figure. Reward the bad at the cost of the good.

 

[Sinjorri]

So the worst case scenario is that we saved 2 American industries at the cost of 3 months worth of Iraq war?

That makes the argument that instead of going into Iraq in 2003, we should have started saving US businesses.

btw, I wonder if they count the tax revenue generated by the saved jobs at GM when they make that calculation?

1) We didn't "save" anything. Bankruptcy has been a viable option for thousand of companies that emerged healthier.
2) The cost of war is non sequiter. Regardless of what we spend on military, it does not justify the bailouts.
3) We did create a tremendous moral hazard.
4) We did screw over the bondholders
5) We did screw over GM's competitors who could have taken market share.

As for number 4.......I still dont get why there was no outrage over that.
As for number 5.....Ford did it right....and they walk away as the losers. Go figure. Reward the bad at the cost of the good.

they do that in schools too.

 

[American_Jihad]

Everything is going according to plan, comrades...

Socialism and Failure ​

 

[AmyNation]

Why do I keep seeing this thread?


Are we being forced to sell the stock now? You are all aware how stock works right?

 

[oreo]

Treasury: U.S. to lose $25 billion on auto bailout

By David Shepardson
Detroit News Washington Bureau

Washington -The Treasury Department says in a new report the government expects to lose more than $25 billion on the $85 billion auto bailout. That's 15 percent higher than its previous forecast.

In a monthly report sent to Congress on Friday, the Obama administration boosted its forecast of expected losses by more than $3.3 billion to almost $25.1 billion, up from $21.7 billion in the last quarterly update.

The report may still underestimate the losses. The report covers predicted losses through May 31, when GM's stock price was $22.20 a share.

On Monday, GM stock was trading down 6 cents, or 0.2 percent, to $20.49. At that price, the government would lose another $850 million on its GM bailout.

The government still holds 500 million shares of GM stock and needs to sell them for about $53 each to recover its entire $49.5 billion bailout.

Treasury spokesman Matt Anderson said the costs were still far less than some predicted.

"The auto industry rescue helped save more than one million jobs throughout our nation's industrial heartland and is expected to cost far less than many had feared during the height of the crisis," Anderson said.

The Obama administration initially estimated it would lose $44 billion on the bailout but reduced the forecast to $30 billion in December 2009.

Republican presidential candidate Mitt Romney has decried the losses on the auto bailout and insisted that forcing GM and Chrysler Group LLC to go through bankruptcy first would have saved taxpayers money.

But President George W. Bush — who gave the automakers and their finance arms about $25 billion in his final weeks in office in bailout funds — said there wasn't time.

Taxpayers incurred a $1.3 billion loss on the $12.5 billion bailout of Chrysler.

The Treasury also has put on hold an initial public offering initially planned for last year in Ally Financial Inc. because of market weakness. The government holds a 74 percent majority stake in the Detroit auto finance company as part of its $17.2 billion bailout and has recovered $5.7 billion.

GM CEO Dan Akerson told employees at a town hall meeting Thursday that the company was working to take actions to boost the automaker's sagging price.

[email protected]



From The Detroit News: Treasury: U.S. to lose $25 billion on auto bailout | The Detroit News | detroitnews.com

Setting another record for our Harvard educated--COMMUNITY ORGANIZER--Economic MORON.

Solyndra--500 million along with 3 other solar companies adding up to 800 million and now the "auto UNION" bailout flops too.

"When you have no record to run on, you need to paint your opponent as someone people should run from"--Barack Obama

 

[Inthemiddle]

5) We did screw over GM's competitors who could have taken market share.

This is the most important part in all of this. Let a failing company fail, and a succeeding company will have the opportunity to rise up and fill the void.

 

[Shelzin]

So the worst case scenario is that we saved 2 American industries at the cost of 3 months worth of Iraq war?

That makes the argument that instead of going into Iraq in 2003, we should have started saving US businesses.

btw, I wonder if they count the tax revenue generated by the saved jobs at GM when they make that calculation?

1) We didn't "save" anything. Bankruptcy has been a viable option for thousand of companies that emerged healthier.
2) The cost of war is non sequiter. Regardless of what we spend on military, it does not justify the bailouts.
3) We did create a tremendous moral hazard.
4) We did screw over the bondholders
5) We did screw over GM's competitors who could have taken market share.

Agreed.

 

[Synthaholic]

Why not keep the stock and let the interest on them help pay for the bailout.

Better to hold than sell at a lost anyway. GM is not going any where so holding until the stock rises again seems like a good policy here.

I knew if I kept reading I would come across a correct answer.

 

[Synthaholic]

So the worst case scenario is that we saved 2 American industries at the cost of 3 months worth of Iraq war?

That makes the argument that instead of going into Iraq in 2003, we should have started saving US businesses.

btw, I wonder if they count the tax revenue generated by the saved jobs at GM when they make that calculation?

1) We didn't "save" anything. Bankruptcy has been a viable option for thousand of companies that emerged healthier.
2) The cost of war is non sequiter. Regardless of what we spend on military, it does not justify the bailouts.
3) We did create a tremendous moral hazard.
4) We did screw over the bondholders
5) We did screw over GM's competitors who could have taken market share.

As for number 4.......I still dont get why there was no outrage over that.
As for number 5.....Ford did it right....and they walk away as the losers. Go figure. Reward the bad at the cost of the good.

If by GM's competitors you mean Toyota, Honda, Nissan, VW, etc., I say fuck 'em. They are not American companies. It's not the U.S. government's job to take care of them.

 

[Zander]

Now Obama wants to do what he did to GM to "all industries"....he's an economic illiterate.