Big Three Bailout

[CalifGuy]

GM said in a statement it would increase the planned offering of common stock to 478 million shares from the previously expected 365 million shares, a sign of stronger-than-expected demand for a stake in the automaker that is just 16 months out of bankruptcy protection.

The move, coupled with an expected stock price of up to $33 per share, would bring the U.S. government closer to getting back the $50 billion it spent bailing out GM last year. It could also make GM's IPO the largest in history for a U.S.-based company.

More here:

[horizon200]

Originally Posted by CalifGuy

GM said in a statement it would increase the planned offering of common stock to 478 million shares from the previously expected 365 million shares, a sign of stronger-than-expected demand for a stake in the automaker that is just 16 months out of bankruptcy protection.

The move, coupled with an expected stock price of up to $33 per share, would bring the U.S. government closer to getting back the $50 billion it spent bailing out GM last year. It could also make GM's IPO the largest in history for a U.S.-based company.

More here:

Great spin! Maybe it was in response to the demand that the common stockholder not be shut out in favor of government purchasers!

[user 6507]

Originally Posted by horizon200

Great spin! Maybe it was in response to the demand that the common stockholder not be shut out in favor of government purchasers!

Don't worry....you'll never be able to get your grubby little commoners hands on a share until the big boys have squeezed all the profit out of it. But thanks with helping bail them out though...

[roni]

Originally Posted by StephenB

Don't worry....you'll never be able to get your grubby little commoners hands on a share until the big boys have squeezed all the profit out of it. But thanks with helping bail them out though...

You gonna buy any shares this morning?

[user 6507]

Originally Posted by roni

You gonna buy any shares this morning?

I might just try to guy a share or two just to see if it's possible for the little guy who bailed their asses out to get one. I know big business can...and huge foreign interests.

I'm sure the average taxpayer will eventually be able to buy one in the hand-me-down market at inflated prices...

I don't really care about owning GM...in a way I already do. I just don't like the way joe blow has been excluded from this. Does not seem right to me.

[James A.]

Originally Posted by StephenB

Don't worry....you'll never be able to get your grubby little commoners hands on a share until the big boys have squeezed all the profit out of it. But thanks with helping bail them out though...

You don't have the right Financial Advisor...

[CalifGuy]

Originally Posted by StephenB

I might just try to guy a share or two just to see if it's possible for the little guy who bailed their asses out to get one. I know big business can...and huge foreign interests.

I'm sure the average taxpayer will eventually be able to buy one in the hand-me-down market at inflated prices...

I don't really care about owning GM...in a way I already do. I just don't like the way joe blow has been excluded from this. Does not seem right to me.

Last trade 10:28 AM $34.89....I can buy it on-line and I'm just an average taxpayer.

[user 6507]

Originally Posted by CalifGuy

Last trade 10:28 AM $34.89....I can buy it on-line and I'm just an average taxpayer.

That is good. Did you actually try to buy some or are you just saying it's available? I don't have an on-line account. I don't intend to buy any. But if I wanted to there was word that it would be tough. I was concerned that it would not be easily available to John Q public....perhaps my fears were unfounded.

[beerbreath]

BTW,the unemployment extension just failed in the House.
This means if you have collected for 6 months or more you are cut off.This affects about 2 million Americans.

Happy Holidays.

[billwarm]

(Reuters) - General Motors Co may have the world's biggest initial public offering, but U.S. taxpayers were more than $9 billion underwater on the government-funded restructuring at its current share price on Thursday.
A breakdown of the paper loss follows.
* The U.S. Treasury loaned GM about $49.86 billion from late 2008 through 2009 to restructure the company and finance its move through bankruptcy and beyond.
* Before accounting for the Treasury proceeds from the IPO, GM had repaid about $9.74 billion to the government. Those repayments included unused loans, the purchase of Treasury preferred shares, and dividends and interest. That left taxpayers owed a little more than $40.1 billion.
* Including overallotments, Treasury will recover more than $13.6 billion by selling 412.3 million common shares, leaving taxpayers owed about $26.5 billion. Treasury would need to sell its remaining 500.1 million share-stake at an average price of about $53 for taxpayers to be repaid.
* With GM shares trading at $34.50 Thursday afternoon on the New York Stock Exchange, taxpayers were facing an $18.50 per-share deficit on their remaining stake, or about $9.25 billion.

[James A.]

Originally Posted by StephenB

That is good. Did you actually try to buy some or are you just saying it's available? I don't have an on-line account. I don't intend to buy any. But if I wanted to there was word that it would be tough. I was concerned that it would not be easily available to John Q public....perhaps my fears were unfounded.

It accounted for a third of the volumn on the NYSE yesterday. It's available in any size to any investor with an account...from E-trade to traditional wirehouses.

[user 6507]

Originally Posted by James A.

It accounted for a third of the volumn on the NYSE yesterday. It's available in any size to any investor with an account...from E-trade to traditional wirehouses.

That is good and just the way it should be. I had read some initial reports from reputable sources that the public might end up getting shut out of this-I'm glad those reports were wrong. That would have not been right.

I hope all goes well because GM is still on the hook to us large...

[sharkbait]

Originally Posted by StephenB

That is good and just the way it should be. I had read some initial reports from reputable sources that the public might end up getting shut out of this-I'm glad those reports were wrong. That would have not been right.

I hope all goes well because GM is still on the hook to us large...

That and the millions of American Jobs they generate.

[Jacko]

Go figure, despite all the naysayers, this is still looking like a very good thing....

G.M. Finds a More Receptive Public

One of the year’s biggest weekends for car dealers is also doubling as a coming-out party for General Motors, just a week after the company shed the government’s majority ownership. Evidence is emerging on car lots that consumers are starting to feel more positive about G.M. and less angry about the billions of dollars in federal aid it received.

[billwarm]

Originally Posted by Jacko

Go figure, despite all the naysayers, this is still looking like a very good thing....

G.M. Finds a More Receptive Public

One of the year’s biggest weekends for car dealers is also doubling as a coming-out party for General Motors, just a week after the company shed the government’s majority ownership. Evidence is emerging on car lots that consumers are starting to feel more positive about G.M. and less angry about the billions of dollars in federal aid it received.

GM's union recovering after stock sale

Taxpayers and investors not as fortunate as UAW

By Patrice Hill
-
The Washington Times
7:24 p.m., Thursday, November 25, 2010
General Motors Co.'s recent stock offering was staged to start paying back the government for its $50 billion bailout, but one group made out much better than the taxpayers or other investors: the company's union.

Thanks to a generous share of GM stock obtained in the company's 2009 bankruptcy settlement, the United Auto Workers is well on its way to recouping the billions of dollars GM owed it — putting it far ahead of taxpayers who have recouped only about 30 percent of their investment and further still ahead of investors in the old GM who have received nothing.
The boon for the union fits the pattern established when the White House pushed GM into bankruptcy and steered it through the courts in a way that consistently put the interests of the union ahead of many suppliers, dealers and investors — stakeholders that ordinarily would have fared as well or better under the bankruptcy laws.
"Priority one was serving the interests of the UAW" when the White House's auto task force engineered the bankruptcy, said Glenn Reynolds, an analyst at CreditSights. The stock offering served to show once again how the White House has handsomely rewarded its political allies, he said.
The union's health care and pension trust fund earned $3.4 billion through the sale of one-third of its shares in GM last week. Analysts estimate that it would break even if it sells the remaining two-thirds of its shares at an average price of $36 — close to where the stock traded shortly after the offering hit the market. GM shares closed at $33.45 on Wednesday.
President Obama inspects the new Chevrolet Volt during his tour of the General Motors Auto Plant in Hamtramck, Mich., in July. The United Auto Workers' health care and pension trust fund earned $3.4 billion through the sale of General Motors Co. stock last week. (Associated Press)

For taxpayers to break even, by contrast, the stock would have to rise to at least $52 and by some estimates as high as $103 — levels that would take years to achieve.
In any event, after selling one-third of its shares last week, the U.S. Treasury has agreed not to sell any more of its GM stock for another six months, while the union fund is free to keep selling its shares.
Through the offering, the Treasury recouped $13.7 billion of its $49.5 billion cash infusion in GM, with another $1.8 billion possible by the end of the year. GM is repaying another $9.5 billion in loans from the Treasury, but that still leaves taxpayers a long way from breaking even.
Union claims ordinarily do not receive such special treatment in bankruptcies.
The generous share of GM stock given to the union trust fund under the White House deal puts it not only ahead of the Treasury but on a par with secured creditors such as banks, which normally receive the most favorable treatment from bankruptcy courts.

Perhaps the biggest losers are the investors in the old GM. None of the bankrupt company's previous stockholders got any money, while the claims of thousands of investors who purchased the company's bonds are still being kicked around in a Manhattan bankruptcy court.
"It gives outraged flashbacks to the old GM bondholders," who remain mired in the bankruptcy proceedings and are unlikely to recover more than 30 percent of their investments, Mr. Reynolds said.
He compared the deal to the corrupt crony capitalism in Russia under President Vladimir Putin.