Will GM be significantly foriegn owned?

[Big Fitz]

I read where more than one Chinese company (a.k.a. Chinese Gov't) is already set to purchase not only GM but Chrysler.

Just how stupid are we?

Apparently... very.

I have no problems with GM being foreign owned, by private individuals or corporations. Not nations.

 

[iamwhatiseem]

In all seriousness - what do we do?
I think all that we can do - take care of our own.

loosecannon is exactly right - 5 years ago people who paid attention, and are capable of independent thought, could plead ignorance. But now?
Do you all remember the phrase "too big too fail"?
Have you noticed anything? Like maybe the "big" that our government was referring to - is bigger? And with the Fed's help is growing like wildfire?? The very companies that this administration promised to reign in - are now larger!
Right in front of our eyes power is shifting. These companies don't give a flying f*ck about any of us. And they all would sell their Mothers soul to anyone who makes an offer.

We no longer hold the keys.

 

[william the wie]

I have to disagree with most of what is being written on this thread. China like Japan two decades ago has a levitating economy that is going to crash spectacularly probably within 1 year and definitely within 5 years. Me, I'm just popping corn over this news.

 

[loosecannon]

I have to disagree with most of what is being written on this thread. China like Japan two decades ago has a levitating economy that is going to crash spectacularly probably within 1 year and definitely within 5 years. Me, I'm just popping corn over this news.

OK Willie, but China is SO not Japan. You are comparing popcorn to hand grenades imo.

 

[loosecannon]

In all seriousness - what do we do?
I think all that we can do - take care of our own.

loosecannon is exactly right - 5 years ago people who paid attention, and are capable of independent thought, could plead ignorance. But now?
Do you all remember the phrase "too big too fail"?
Have you noticed anything? Like maybe the "big" that our government was referring to - is bigger? And with the Fed's help is growing like wildfire?? The very companies that this administration promised to reign in - are now larger!
Right in front of our eyes power is shifting. These companies don't give a flying f*ck about any of us. And they all would sell their Mothers soul to anyone who makes an offer.

We no longer hold the keys.

I am just curious. Do you think the tea party or the repubs would be handling China differently?

 

[loosecannon]

Army: China won't make U.S. military Humvees

Army: China won't make U.S. military Humvees

The Associated Press

Published: June 4, 2009

DETROIT - The U.S. Army is assuring people that General Motors' deal to sell its Hummer brand to a Chinese company has nothing to do with the military version of the rugged vehicle.

Officials said some people called the Pentagon, Capitol Hill and AM General LLC, the company that makes the military vehicles, asking if the rights to the Humvee had been sold to the Chinese.

Steve Clawson, spokesman for the South Bend, Ind.-based AM General, said the military and civilian programs are separate.

"GM's proposed sale of the civilian Hummer brand would have no impact on the military Humvee program," he said.

Additionally GM sold it's Saab brand to a Swedish firm and Chrysler took on an Italian firm (Fiat) as a primary partner. After having been purchased by a Greek firm, Cyberus:

General Motors Chapter 11 reorganization - Wikipedia, the free encyclopedia

Chrysler - Wikipedia, the free encyclopedia

This is just too high:

Founded in 1992, Cerberus is named for the mythological three-headed dog that guarded the gates of Hades. Feinberg has stated to his employees that while the Cerberus name seemed like a good idea at the time, he later regretted naming the company after the mythological dog.[1]

The company has been a very active acquirer of businesses over the past several years and now has sizable investments in automotive, sportswear, paper products, military services, real estate, energy, retail, glassmaking, transportation, and building products. In 2006, its holdings amounted to $24 billion.

On October 19, 2006, John W. Snow, President George W. Bush's second Treasury Secretary, was named chairman of Cerberus.

J. Ezra Merkin is a partner in Cerberus. Merkin invested his funds into Cerberus and its portfolio companies. His Gabriel fund invested $79 million in Chrysler, $66 million in GMAC and $67 million in Cerberus partnerships, according to year-end statements.[2] The Gabriel Fund was a feeder fund for Bernard L. Madoff Investment Securities LLC.[3]

The Japanese bank, Aozora, a Cerberus company lost $137 million to Bernard L. Madoff Investment Securities LLC. Aozora was part of the investment group that acquired 51 percent of GMAC from General Motors. [4]

On April 12th 2010 Cerberus acquired the private military contractor DynCorp International.

 

[william the wie]

I have to disagree with most of what is being written on this thread. China like Japan two decades ago has a levitating economy that is going to crash spectacularly probably within 1 year and definitely within 5 years. Me, I'm just popping corn over this news.

OK Willie, but China is SO not Japan. You are comparing popcorn to hand grenades imo.

True China is more leveraged than Japan ever was and in proportion to GDP its real estate bubble is much bigger. China is a grenade compared to Japans kernels of popcorn in 1990-3.

 

[loosecannon]

We have done this dance before Willie. Japan is a pissant that never should have come anywhere near world econ giant status. Whereas 1 in 5 humans are Chinese. They were born to be superpowers.

And so far China is firmly opposed to accepting anything like the Plaza accord. Which is what killed the Japanese economy.

The Plaza Accord or Plaza Agreement was an agreement between the governments of France, West Germany, Japan, the United States, and the United Kingdom, to depreciate the U.S. dollar in relation to the Japanese yen and German Deutsche Mark by intervening in currency markets. The five governments signed the accord on September 22, 1985 at the Plaza Hotel in New York City.

The exchange rate value of the dollar versus the yen declined by 51% from 1985 to 1987. Most of this devaluation was due to the $10 billion spent by the participating central banks.[citation needed] Currency speculation caused the dollar to continue its fall after the end of coordinated interventions. Unlike some similar financial crises, such as the Mexican and the Argentine financial crises of 1994 and 2001 respectively, this devaluation was planned, done in an orderly, pre-announced manner and did not lead to financial panic in the world markets.

The reason for the dollar's devaluation was twofold: to reduce the U.S. current account deficit, which had reached 3.5% of the GDP, and to help the U.S. economy to emerge from a serious recession that began in the early 1980s. The U.S. Federal Reserve System under Paul Volcker had overvalued the dollar enough to make industry in the U.S. (particularly the automobile industry) less competitive in the global market.

Devaluing the dollar made U.S. exports cheaper to its trading partners, which in turn meant that other countries bought more American-made goods and services.

The Plaza Accord was successful in reducing the U.S. trade deficit with Western European nations but largely failed to fulfill its primary objective of alleviating the trade deficit with Japan. This deficit was due to structural conditions that were insensitive to monetary policy, specifically trade conditions.

The Manufactured goods of the United States became more competitive in the exports market but were still largely unable to succeed in the Japanese domestic market due to Japan's structural restrictions on imports.[clarification needed]

The recessionary effects of the strengthened yen in Japan's export-dependent economy created an incentive for the expansionary monetary policies that led to the Japanese asset price bubble of the late 1980s. The Louvre Accord was signed in 1987 to halt the continuing decline of the U.S. dollar.

The signing of the Plaza Accord was significant in that it reflected Japan's emergence as a real player in managing the international monetary system. Yet it is postulated[2] that it contributed to the Japanese asset price bubble, which ended-up in a serious reccession, the so-called Lost Decade.

Plaza Accord - Wikipedia, the free encyclopedia

 

[iamwhatiseem]

Remind me again what else happened in 2008 besides our government selling our debt to foreign countries?
Quite a jump after 2008.

 

[loosecannon]

Report: China's Largest Automaker to Invest in GM

SAIC Motor Corp., China's largest automaker and a joint-venture partner with General Motors, is preparing to buy about $500 million worth of stock in the Detroit automaker, according to a newspaper website.

The Wall Street Journal reported Friday that SAIC is one of several foreign investors who could buy GM shares worth more than $1 billion as part of an initial public stock offering scheduled for Nov. 18. GM and SAIC wouldn't comment on the report when contacted by The Associated Press.

The U.S. government, which now owns 61 percent of GM but is looking to reduce its stake to around 40 percent in the IPO, has said the company would seek foreign investment as well as investment from the U.S.

Foreign investment in U.S. automakers and other companies is common.

Investment from sovereign wealth funds is considered good for a company because the funds tend to hold stakes for a long time, providing stability, the newspaper said. But it's also a touchy issue for the Obama administration, especially if some individual investors in the U.S. are unable to buy shares in the IPO.

U.S. taxpayers gave GM $50 billion to get it through bankruptcy protection last year. The automaker has repaid or plans to repay $9.5 billion, and the government hopes to get the remaining $40 billion back through the IPO and several follow-up sales.

So GM is repaying it's TARP bailouts by spinning off subsidiaries toward China and selling it's core stocks to China's leading auto maker and this is a "good" thing. The feds welcome it.

 

[loosecannon]

Remind me again what else happened in 2008 besides our government selling our debt to foreign countries?

The credit crisis and the recession.

 

[loosecannon]

American taxpayers’ ownership of General Motors was halved on Wednesday, and billions of dollars in bailout money was returned to the federal government, as a result of the nation’s largest initial stock offering ever.

The offering, which raised $23.1 billion, is bigger and more ambitious than had once seemed possible. But the recently bankrupt automaker will have to build on its revival for the government to recoup its entire $50 billion investment and validate the Obama administration’s decision to keep G.M. from collapsing.

The new shares start trading on Thursday at $33 each. To break even, the Treasury Department will need to sell its remaining 500 million shares at an average price of $53 each in the months and years to come. And while the administration may retain great influence over the company, it may not be able to keep stoking the enthusiasm investors have shown for G.M. stock in recent days.

Still, now that General Motors has shown that it can be profitable, a complete exit by the government could happen even within the next two years. With the offering, G.M. is shedding its ties to the government faster than expected, cutting the Treasury Department’s ownership stake to 26 percent, from nearly 61 percent.

The offering, President Obama said on Wednesday, continues “our disciplined commitment to exit this investment while protecting the American taxpayer.”

http://www.nytimes.com/2010/11/18/business/18auto.html?src=mv

Treasury Takes Initial Public Loss on GM Shares

WASHINGTON -- U.S. taxpayers are about $10 billion in the red on their General Motors Co. investment after Wednesday's initial public offering. Whether the Treasury can ultimately break even will depend on how GM shares perform over the next few years.

The Treasury Department agreed Wednesday to sell 358.5 million of its common shares in GM at $33 a share, senior Obama administration officials said.

That sale raised $11.8 billion for U.S. taxpayers. It also valued the Treasury's entire 61% stake in GM -- including the shares it sold -- at about $30 billion.

The Treasury paid about $40 billion for the 912 million common shares it held at the start of the day Wednesday. To get that all back at once, the Treasury would have had to sell all its shares at about $43.85 in the IPO.

After the IPO, the Treasury Department retains about a 37% stake in GM. The remaining 554 million common shares the government owns have an indicated value of about $18.3 billion at Wednesday's IPO price.

Treasury Takes Initial Public Loss on GM Shares - WSJ.com

No word yet on how great a stake China will take in this IPO.