U.S. to sell rest of GM shares by year-end, may lose $10 billion

[OneCrazyDiamond]

Source: Reuters

(Reuters) - The U.S. Treasury Department said it expected to sell its remaining shares of General Motors Co (GM.N) by the end of the year, a plan that may leave taxpayers with a shortfall of about $10 billion on the automaker's 2009 bailout.

Read more: http://www.reuters.com/article/2013/11/21/us-gm-treasury-idUSBRE9AK0R720131121

[Fuddnik]

1. I guess Warren Buffet, we ain't.

Who's gonna be their new CEO? Timmeh or Bernanke?

[phleshdef]

2. Yea, 10 billion is like, 100 bucks or something in the context of our budget.

[Psephos]

7. Or, it's like food for a year for five million people. n/t

[phleshdef]

8. We spend a lot more than that feeding folks.

The fact is, if the auto companies had gone under, the butterfly effect across all the related supply chains would've been devastating and a lot more than 5 million more people would've been struggling.

[Psephos]

9. except that that the auto companies would have reorganized and continued in business

they would not have liquidated, they would have discharged debt and restored access to credit

they would be stronger, leaner, and more competitive if they shed their debts and liquidated shareholder equity, and spent the money on improving product and process

read up on reorganization under bankruptcy

...and btw, the idea that food for five million is a trifle - or any other useful thing that can be done with that $$ - is bullshit...money is not free

[phleshdef]

10. Thats bullshit.

They would have HAD to liquidate because they didn't have enough money to keep the doors open to make it through the period of time they would have had to have survived to reach the end of a managed bankruptcy. No one was loaning money. Credit lines for everyone was frozen. The financial system was on the verge of collapse. This would've happened on top of the fact that the economy was literally bleeding hundreds of thousands of jobs per month already. Millions of folks would've been laid off, furloughed, etc.

I'm so glad it was the Obama administration making this decision and not you.

[Psephos]

11. actually, it was initiated under Bush...crony capitalism at its finest

they didn't need $50 billion in cash

they needed a bridge loan guarantee while they set up new lines of credit...they would have stayed in business, and would be stronger for it today

[phleshdef]

12. And probably one of the few sound decisions Bush ever made.

Theres not a credible economist that disagrees with the necessity of the bailout.

Who were they gonna get a bridge loan guarantee from besides the government at that time? Who was going to establish new lines of credit with them in a timely enough fashion? You are completely ignoring what was going on during this period of time.

The auto-bailout was a success. Get over it.

[Psephos]

13. "there's not a credible economist that disagrees with the necessity of the bailout" - oooookkkaaayy

the bridge loan guarantee would come from the government...a worthy and timely intervention

with that guarantee there would not have been a problem securing bridge financing

the auto bailout protected and enriched fat cats and fucked over bondholders (largest of which were pension funds), and fucked over taxpayers as well with the losses

meanhwile, the companies are not now as strong as they would have been if subjected to market discipline, and Chrysler would not be owned by Fiat

success lol

[phleshdef]

14. Sell that bullshit to Milton Friedman or Ron Paul or something.

"Market discipline" is more free market fairy nonsense. Your argument is collapsing into superstitious economics at this point, I don't even bother entertaining that crap anymore.

[Psephos]

15. lol ooookkkaaaaayyyyy

[geek tragedy]

16. You're the one saying Mitt Romney was right. nt

[phleshdef]

18. On the auto bailout? Yea, he basically agreed with what they did and then said he didn't.

[geek tragedy]

19. I was saying the bondholder advocate was agreeing with Willard.

Romney favored letting the private sector determine Detroit's fate, via lines of credit that no one was going to offer.

[phleshdef]

22. Right, but after the fact, he was selling that line about how the admin should've did...

...a managed bankruptcy... acting as if that wasn't exactly what they did, lol. God he was one of the worst candidates ever, looking back.

[Psephos]

20. no, you're the one saying that n/t

[geek tragedy]

17. So, you're touting the "Let Detroit go Bankrut" plan by Willard M. Romney. nt

[Psephos]

21. you seem to not understand the difference between reorganization and liquidation

by the way, GM and Chrysler DID go bankrupt...you do understand that, right?

[AnalystInParadise]

27. Could not agree more Psephos

we bailed out the fat cats and watching people defend it is mildly disturbing.

[bhikkhu]

3. A good overview of that, if anyone's interested:

forbes.com/sites/danbigman/2013/10/30/how-general-motors-was-really-saved-the-untold-true-story-of-the-most-important-bankruptcy-in-u-s-history/

A whole lot more than $10 billion was at stake. It would have been nice to see the net deal break even in simple terms, but it shouldn't be hard, if you worked out the overall figures and impacts, to say that was a bargain, considering the alternatives.

[exboyfil]

4. Yes Romney and his vulture capitalist friends

walked away with a good chunk of that amount. At the negotiating table everyone was giving something up until it came to one of GM's suppliers who threatened to shut production down unless they extracted their pound of flesh. Romney was one of the passive investors. He may have won if he had done the honorable thing at the time (write a check to the Treasury Dept for his gains). He criticized the bail out but he had the opportunity to at least not benefit from it. His investment would have been worthless if GM went down. He benefited far more than the unions for this agreement.

http://www.thenation.com/article/170644/mitt-romneys-auto-bailout-bonanza#

[ConcernedCanuk]

5. sale of the shares "could lead to the lifting of compensation limitations for GM's key executives

.
.
.

That's a verbatim quote from the OP link.

"sale of the shares "could lead to the lifting of compensation limitations for GM's key executives"

Gee - wonder how many execs are putting $$ in the gov't shills pockets?

nawwwwwwwwwwwwww -

they wouldn't do that . .

would they . . ?? ?

CC

[OneCrazyDiamond]

6. lifting of compensation

Imagine what their compensation will be when they get to "keep" the Gov's ~10 Billion.

I wish corporate charters expired, and the companies were chopped up after they expired.
Eternity is a long time.

[Pterodactyl]

23. Imagine how many people could have been lifted out of poverty with that money.

What a waste.

[hunter]

24. What's the problem with the U.S. government keeping the shares?

I've got no trouble with socialism.

More things ought to be owned by We The People, including things like electric power utilities.

We own most streets, roads, and highways, what's the problem owning portions of the corporations that make the vehicles that drive on them?

[godevil10]

26. Fear or losing even more, maybe. n/t

[Jesus Malverde]

25. I need to look at the details...

but I suspect this means some connected folks made 10 billion. There is usually someone on the other side of a trade....

Goldman, JP, who's the winner...

[Lodestar]

28. Chinese Auto Glass Co. purchasing GM plant in Ohio

http://abcnews.go.com/US/wireStory/chinese-biz-put-plant-ohio-gm-site-21489097

[ManiacJoe]

29. How many shares were purchased and at what price?

According to http://en.wikipedia.org/wiki/Government_Motors
GM stock would need to be $53+ for the government to break even.