GM pays back US & Canadian loans way early

[vsound]

Originally Posted by Supermans

I don't agree with Golden parachutes for anyone.. I'd rather see the money go to the stockholders spread out equally instead.

Exactly! I know that the wealth will never be spread equally. That's a utopian idea, and really...it's communism if you think hard enough about it.

But still, the middle class is getting smaller and smaller, and I just can't help but blame CEOs for it, when that 1% of the population contains 99% of the wealth, and they don't hold themselves accountable.

lol

[bigearl]

Keep in mind, the economy has had a recession after every war. It appeared that the major hostility in Iraq was pretty much over in 2008. We were likely heading to a recession of some kind just based on that alone. At the same time, we had the 'oil-shock' of 07-08 (which is also pretty common at the end of major wars) and the sub-prime debacle which made a bad thing worse and last longer.

We always have these CEO purges and new pushes to have more oversight during these recessions as well. Then the oversight and regs starts to plug the system up and someone roto-rooters it; then oversight gets too lax and in 30-40 years we'll have another recession, probably a war to go with it, some ceo purges, etc.

[vsound]

Originally Posted by bigearl

Keep in mind, the economy has had a recession after every war. It appeared that the major hostility in Iraq was pretty much over in 2008. We were likely heading to a recession of some kind just based on that alone. At the same time, we had the 'oil-shock' of 07-08 (which is also pretty common at the end of major wars) and the sub-prime debacle which made a bad thing worse and last longer.

We always have these CEO purges and new pushes to have more oversight during these recessions as well. Then the oversight and regs starts to plug the system up and someone roto-rooters it; then oversight gets too lax and in 30-40 years we'll have another recession, probably a war to go with it, some ceo purges, etc.

As a guy with a degree in history and business economics, this is very true.

Except with WWII. That war really helped us out of the Great Depression.

But still, it's a cycle. I sort of wish people would stop freaking out.

Sometimes I have to tell myself to calm down about it.

Everyone, go invest in some stocks while they are low and wait for the bear market to turn bull again.

[Supermans]

Originally Posted by vsound

Exactly! I know that the wealth will never be spread equally. That's a utopian idea, and really...it's communism if you think hard enough about it.

But still, the middle class is getting smaller and smaller, and I just can't help but blame CEOs for it, when that 1% of the population contains 99% of the wealth, and they don't hold themselves accountable.

lol

Originally Posted by vsound

As a guy with a degree in history and business economics, this is very true.

As a recently escaped mental patient with a degree in banging head against a wall, I have a differing opinion.

Look, bringing the top three CEO's of the car industries to face congress for example and then demonizing them in every which way leaving themselves blameless in order to bring about a Government takeover is something I do not agree with. it is not all the faults of the CEO's. Government over-regulations have a lot do to with the auto industries problems. On top of the the Auto workers union had a lot to do with the problem as well.. When the Government took over GM, how did the stockholders of GM fair vs how the Union faired? Was the wealth spread equally around? Should it have been? That all depends where your political beliefs and loyalties lie. Never let a crisis go to waste seems to be the motto of our current administration. Currently its aptly named Wallstreet Reform. Demonization is occurring their as well. Does anyone see a pattern emerging her. Ultimately having the Government in control of everything, they can literally print money and do not require a profit to be made. A loan to repay a loan to repay a loan in order to claim all the money has been re-made seems to be what is going on here. It is simply a political message to put Government Motors in good light with the American people. It is not a bad strategy however as I pointed out before, if things are going well, is this type of marketing really necessary. That is why I believe the bad news of a few weeks ago prompted this all of a sudden positive news. Was this card played too soon? Only time will tell.

[alrox]

Originally Posted by The_Blur

You would rather complain that GM is sitting on money it isn't using than complain that GM is paying back government money it isn't using. It all sounds like a lot of complaining to me.

I'm complaining that they have the money at all.

The bailouts were given to GM because of falsified projected sales numbers. GM knows they won't be able to sell the amount of cars they claimed in order to get the bailout. This is the definition of fraud.

[Craig]

These days you can't take ANYTHING at face value, let alone corporate press releases. Here's an alternate take for the GM cheerleaders:

http://blogs.ajc.com/jamie-dupree-wa...ington_insider

The issue came up yesterday at a hearing with the special watchdog on the Wall Street Bailout, Neil Barofsky, who was asked several times about the GM repayment by Sen. Tom Carper (D-DE), who was looking for answers on how much money the feds might make from the controversial Wall Street Bailout.

"It's good news in that they're reducing their debt," Barofsky said of the accelerated GM payments, "but they're doing it by taking other available TARP money."

In other words, GM is taking money from the Wall Street Bailout - the TARP money - and using that to pay off their loans ahead of schedule.

"It sounds like it's kind of like taking money out of one pocket and putting in the other," said Carper, who got a nod of agreement from Barofsky.

"The way that payment is going to be made is by drawing down on an equity facility of other TARP money."

Translated - they are using bailout funds from the feds to pay off their loans.

For you and me, that might be like using one credit card to pay off another, eh?

Hey, and what about that $50 billion bridge loan, the one that will supposedly be paid off by selling the taxpayer's 60% stake in the upcoming IPO?

I did some additonal research which tentatively (one source, unconfirmed) indicated that GM's highest EVER market cap was $52.4 billion at one point in 2000. The numbers simply don't add up if you assert that the taxpayer will be repaid in full by selling their stake. Even assuming GM matches their highest historical market cap, 60% of $52b doesn't equal $50b or anything even reasonably close to it. That doesn't even consider the huge logistical issues and the effect on share price when you start selling such a huge volume of shares. Not only will the taxpayer NOT be made whole, but it will probably take YEARS to liquidate the entire position so as to not tank the share price by flooding the market.

You had better believe that I as well as many other prospective buyers (the ones who take the considerable time and effort necessary to cut through the spin, smoke and mirrors and be truly informed on current events) will take this Wall Street inspired chicanery into account when shopping for their next new vehicle.

[vsound]

Originally Posted by Supermans

Look, bringing the top three CEO's of the car industries to face congress for example and then demonizing them in every which way leaving themselves blameless in order to bring about a Government takeover is something I do not agree with. it is not all the faults of the CEO's. Government over-regulations have a lot do to with the auto industries problems. On top of the the Auto workers union had a lot to do with the problem as well.. When the Government took over GM, how did the stockholders of GM fair vs how the Union faired? Was the wealth spread equally around? Should it have been? That all depends where your political beliefs and loyalties lie.

Right, but isn't it a shame that it took that to get the big three back on track?

I mean, sometimes you have to call people out on their wrongs.

I don't really feel that the government should be involved either, but when the private sector's performance starts pulling down the government, it is the government's job to take control.

Remember, there is such a thing as Martial Law. You can lose your constitutional rights for the benefit and survival of the country. It has happened here before.

[FenwickHockey65]

Originally Posted by alrox

I'm complaining that they have the money at all.

The bailouts were given to GM because of falsified projected sales numbers. GM knows they won't be able to sell the amount of cars they claimed in order to get the bailout. This is the definition of fraud.

Glad to know you sat in on those meetings at the Ren Cen.

I'll take your Corvette off your hands too, by the way. I wouldn't want you to have to suffer the shame of driving a product built by such a horrible company.

[derklug]

The way I interpret the payoff is that GM used money given to it in exchange for stock to pay off a secured loan. Kind of like using a credit card to pay off a car loan so that if you were to have problems, you wouldn't lose the car. As the TARP money doesn't have intrest attached, and the loan presumably does, this makes economic sense.

[Unfair]

Robbing peter to pay paul?

Originally Posted by derklug

The way I interpret the payoff is that GM used money given to it in exchange for stock to pay off a secured loan. Kind of like using a credit card to pay off a car loan so that if you were to have problems, you wouldn't lose the car. As the TARP money doesn't have intrest attached, and the loan presumably does, this makes economic sense.

in the case you stated above you would STILL be in debt, like someone said here if you pay off your visa card with your american express card, don't you still owe american express money?
so in reality what did you pay off, if the money you used wasn't your own?

[Supermans]

Originally Posted by FenwickHockey65

Glad to know you sat in on those meetings at the Ren Cen.

I'll take your Corvette off your hands too, by the way. I wouldn't want you to have to suffer the shame of driving a product built by such a horrible company.

I've owned GM products my whole life. I'm an enthusiast and currently a Camaro SS owner. Don't take for granted those of us who do not like what is going on with our Government and their control and power over General Motors. With that said you are a "GM loyalist till the end", which is commendable. However my advice would be not to be blinded by loyalty in the face of shady politics and political posturing. There was a two year deadline for paying back the loan. Why was it hurried and paid back in this way? I have a hunch it has something to do with not so good news about GM a few weeks ago and the desire to boost public perception of the Government having made the right decisions so far with GM. Ultimately the method of doing this is what I disagree with. I would be happy if the payback occurred by actual profits for the most part.

Originally Posted by derklug

The way I interpret the payoff is that GM used money given to it in exchange for stock to pay off a secured loan. Kind of like using a credit card to pay off a car loan so that if you were to have problems, you wouldn't lose the car. As the TARP money doesn't have intrest attached, and the loan presumably does, this makes economic sense.

TARP money does have interest attached to it. Do not be fooled by anyone telling you differently. It is an indirect interest since you have to look at where the TARP money comes from..

[Georgie]

Supermans I am internet stocking you. Your car is awesome.

[Supermans]

Originally Posted by Georgie

Supermans I am internet stocking you. Your car is awesome.

Thank you I am happy I purchased my Camaro 1SS V8 stick before any gas guzzler tax might be forced upon it. You are getting polished rims and the BA upgrade. I perhaps would not have gotten the BA upgrade if I had a choice again but would have gone aftermarket. The polished rims are a must . The 1SS is definitely better in my opinion than getting a fully loaded V6. Boston Acoustic lacks bass, which is my main problem with it. CGM was my number 1 choice for a long time..But last minute I went with IOM and I am very happy. I have seen some CGM with the stripes around here and they are very nice looking as well. Either one you will be happy.

Now are you stalking me or stocking me? I assume you want to stuff me into a stocking for Christmas

[derklug]

Originally Posted by Unfair

Robbing peter to pay paul?

in the case you stated above you would STILL be in debt, like someone said here if you pay off your visa card with your american express card, don't you still owe american express money?
so in reality what did you pay off, if the money you used wasn't your own?

In the case I presented, if you went bankrupt, you would keep the car. In GM's case, they HAVE to repay the loan, but the other funds get repaid by the sale of stock.