GM pays back US & Canadian loans way early

[Brokinarrow]

Originally Posted by 8cd03gro

There are no retained earnings when you declare chapter 11 and follow up with consistent losses. They're paying back with loan money because things are looking up and GM COULD be profitable this year, which is good.

Listen guys, like someone pointed out, I live in Michigan. I would love to see GM be successful again and recent news shows hope, but my point is this: You guys seem to think yesterday and today's news means GM is back, profitable again and growing to what it used to be. Realistically, these "lesser" loans could have been paid off right away with TARP money and GM would still be out $60 Billion. Even in one of the articles someone posted, GM said they are still years away from a full return and that all depends on if they are profitable this year. GM is making the right moves to look good in the public eye (very important) and they seem to be doing better, but thinking they're off the hook and ready to go is a far-cry from the truth. There's still a loooonnnng road ahead for GM to even break even on taxpayer money. This payment is a good thing and I'm very happy, but it's not even close, NOT EVEN CLOSE to even for GM. To get there, they still need to post profits and they need to do it for an extended period of time. I'm just debating to make it clear that the statements your seeing of, "GM has payed back all of it's loans" does not mean the taxpayers aren't still owed billions of dollars and GM isn't still a money pit of tens of billions of dollars. Anyway, GM looks to be on the right track and hopefully within 4-5 years we will see General Motors again as opposed to government motors.

My understanding was that a very large chunk of the 'loan' that GM received was in the form of the government buying a large portion of their shares. This will be bought back once GM starts offering their shares to the public again. I'll admit I'm not sure how this part will be handled, but unless they only release a certain amount of shares to the public, won't the 'break even' point be limited to how quickly the government sells its' shares?

[FenwickHockey65]

Originally Posted by Brokinarrow

My understanding was that a very large chunk of the 'loan' that GM received was in the form of the government buying a large portion of their shares. This will be bought back once GM starts offering their shares to the public again. I'll admit I'm not sure how this part will be handled, but unless they only release a certain amount of shares to the public, won't the 'break even' point be limited to how quickly the government sells its' shares?

Correct, once the government sells off their shares in GM in the IPO, the remaining amount given to GM will be recovered.

[DGthe3]

Originally Posted by 8cd03gro

There are no retained earnings when you declare chapter 11 and follow up with consistent losses. They're paying back with loan money because things are looking up and GM COULD be profitable this year, which is good.

Listen guys, like someone pointed out, I live in Michigan. I would love to see GM be successful again and recent news shows hope, but my point is this: You guys seem to think yesterday and today's news means GM is back, profitable again and growing to what it used to be. Realistically, these "lesser" loans could have been paid off right away with TARP money and GM would still be out $60 Billion. Even in one of the articles someone posted, GM said they are still years away from a full return and that all depends on if they are profitable this year. GM is making the right moves to look good in the public eye (very important) and they seem to be doing better, but thinking they're off the hook and ready to go is a far-cry from the truth. There's still a loooonnnng road ahead for GM to even break even on taxpayer money. This payment is a good thing and I'm very happy, but it's not even close, NOT EVEN CLOSE to even for GM. To get there, they still need to post profits and they need to do it for an extended period of time. I'm just debating to make it clear that the statements your seeing of, "GM has payed back all of it's loans" does not mean the taxpayers aren't still owed billions of dollars and GM isn't still a money pit of tens of billions of dollars. Anyway, GM looks to be on the right track and hopefully within 4-5 years we will see General Motors again as opposed to government motors.

I'm not sure what your issue is. You are saying GM has a long road ahead of them. Of course they do! Even their chairman and CEO has said so. NONE of us think otherwise. We just think its great that they've payed back their loan 6x faster than planned. I can't speak for the others, but personally I am happy because it means that new GM is in such good condition that they could easily generate a profit for their shareholders.

But where do you get the idea that they still owe us? General Motors Company was given a loan for restructuring upon their creation in June 2009. They weren't given any loans before that, because they didn't exist. The loans made to General Motors Corporation were converted into stock in the new GM (General Motors Company). Technically speaking, the loans to old GM won't ever be re-payed but our governments stand to receive billions in dollars for selling their stock in new GM, which they acquired for free (after spending billions in loans to old GM).

[Sax1031]

I do believe GM was let out of bankruptcy with more money than they probably should have been. That is the only way I could see them paying 8.1 billion dollars back in less than a year.

[UCI CamaroFan]

While this certainly was a step in the right direction, GM has a LOOOOOOONG way to go.

Yeah, they paid back the 5.8 billion dollars in loans, but the government still has over 50 billion put into the company.

We shall see how GM's earnings are when they are posted. I hope they are good, but we shall see if they can compete with Ford.

PS, I own Ford stock. It's sitting near its 52 week high.

[Mr. Wyndham]

Originally Posted by UCI CamaroFan

I hope they are good, but we shall see if they can compete with Ford.

I don't expect that to be a problem. Ford is not home-free, right now either...

The REAL concern we should all be focused on is if GM and Ford can together combat the imports effectively now, in both product (and sales) and finances.

I hope to see the two of them acquire a combined 50% market share or better by the end of the decade.

[alrox]

To be very honest and to put ourselves down as a country, GM should have went out of business 15 years ago. Without the credit bubble that let millions of families buy overpriced homes on credit they did not deserve also let them also buy overpriced SUV's and other worthless vehicles which put us further in the hole.

When the federal reserve realized they could print money and give it away with no consequences GM started making a lot of money. We are far, far more in debt than the mass media lets on. It should be a well known fact that we were hours away from tanks in the streets in September 2008 but the general public doesn't seem to care as long as the status quo is maintained.

It will fail.

[Mr. Wyndham]

Originally Posted by alrox

To be very honest and to put ourselves down as a country, GM should have went out of business 15 years ago. Without the credit bubble that let millions of families buy overpriced homes on credit they did not deserve also let them also buy overpriced SUV's and other worthless vehicles which put us further in the hole.

When the federal reserve realized they could print money and give it away with no consequences GM started making a lot of money. We are far, far more in debt than the mass media lets on. It should be a well known fact that we were hours away from tanks in the streets in September 2008 but the general public doesn't seem to care as long as the status quo is maintained.

It will fail.

What a happy outlook...

[UCI CamaroFan]

Originally Posted by Dragoneye

I don't expect that to be a problem. Ford is not home-free, right now either...

The REAL concern we should all be focused on is if GM and Ford can together combat the imports effectively now, in both product (and sales) and finances.

I hope to see the two of them acquire a combined 50% market share or better by the end of the decade.

All hail Al Mulally.

Cramer put him on the $100 bill today

[Mr. Wyndham]

Originally Posted by UCI CamaroFan

All hail Al Mulally.

Cramer put him on the $100 bill today

? Okay? Still doesn't wipe the debt from their books....
I didn't say I DIDN'T like them...they are impressive right now...but far from being in the clear.

[UCI CamaroFan]

Originally Posted by Dragoneye

? Okay? Still doesn't wipe the debt from their books....
I didn't say I DIDN'T like them...they are impressive right now...but far from being in the clear.

No, but he cut costs and consolidated Ford so that it is basically stealing market share away from everybody right now. Also, because Ford is doing so well, it's going to boost Ford's credit rating so borrowing to finance that debt will be much cheaper.

Also, yay no government control.

[BackinBlackSS/RS]

Originally Posted by alrox

To be very honest and to put ourselves down as a country, GM should have went out of business 15 years ago. Without the credit bubble that let millions of families buy overpriced homes on credit they did not deserve also let them also buy overpriced SUV's and other worthless vehicles which put us further in the hole.

When the federal reserve realized they could print money and give it away with no consequences GM started making a lot of money. We are far, far more in debt than the mass media lets on. It should be a well known fact that we were hours away from tanks in the streets in September 2008 but the general public doesn't seem to care as long as the status quo is maintained.

It will fail.

pessimism is fail

[DGthe3]

Originally Posted by UCI CamaroFan

No, but he cut costs and consolidated Ford so that it is basically stealing market share away from everybody right now. Also, because Ford is doing so well, it's going to boost Ford's credit rating so borrowing to finance that debt will be much cheaper.

Also, yay no government control.

How does Ford differ from GM in that regard?

[Mr. Wyndham]

Originally Posted by UCI CamaroFan

No, but he cut costs and consolidated Ford so that it is basically stealing market share away from everybody right now. Also, because Ford is doing so well, it's going to boost Ford's credit rating so borrowing to finance that debt will be much cheaper.

Also, yay no government control.

Really? You're going to push back? I'm trying to be polite and neutral so as to avoid this conversation...and you're pushing back.

Originally Posted by DGthe3

How does Ford differ from GM in that regard?

This.

I couldn't quite get it out without screaming...