Ford Motor Co. is telling lawmakers it is concerned that federal support for GMAC LLC is giving the rival auto lender cheaper borrowing costs.
Diesel Civil Trust
0.000000435%
is roughly the percent of GM that each of us own.
$362 is what each of us paid for that equity stake.
That’s because $50,000,000,000 is the total amount the US Treasury has spent of GM’s survival. (That’s $30.1 billion for 60% of New GM’s equity + $20.6 billion that we spent trying to keep them out of bankruptcy.) And that’s just the beginning of it.
So $83,000,000,000 is what New GM would have to be worth in order for us to break even on our investment.
But $56,000,000,000 is what GM was worth at its all time peak in 2000.
And it’s only worth about $7,300,000,000 now.
So New GM would have to have about a 48% increase in value from its all time peak. Likely?
The new paradigm in transportation will be efficiency. Getting products and people from Point A to Point B as cheaply as possible. Oil will be expensive, so getting oil out of the equation as much as possible will be the goal. So far, all this hybrid/electric/flexfuel/ethanol crap has been framed as a moral and ethical issue and is really just smoke and mirrors: the real impact on the environment and fossil fuel consumption haven’t really improved. Soon it will be an economic imperative that we get serious about efficient transportation. Soon, we won’t have a choice. Trains will be what get products and people around. Buses will be more prevalent because the infrastructure already exists to support it. You know what I would love to see? An affordable, no frills, electric motorcycle. In the not-so-distant future, I will be looking for ways to keep from having to drive my car.
How Would You Reconceive GM for the 21st Century? - Umair Haque - HarvardBusiness.org Umair’s blog always gets the most interesting comments (via neekolas)
G.M.’s Road From Prosperity to Crisis
WASHINGTON — It is not every 31-year-old who, in a first government job, finds himself dismantling General Motors and rewriting the rules of American capitalism.
GM’s Chapter 11 filing caps a decades-long slide, but it should emerge relatively quickly from court with lower labor and debt costs.
A group of major General Motors bondholders on Thursday gave its support for a revised bond exchange, saying the option of litigation in bankruptcy court was too risky.
Moving Toward Government Motors?
“It is now clear that there is no real difference between the government and the entity that identifies itself as GM. For all intents and purposes, the government, which is set to assume a 50 percent equity stake in the company, is GM, and it has been calling the shots in negotiations with creditors. While the Obama administration has been playing hardball with bondholders, it has been more than happy to play nice with the United Auto Workers. How else to explain why a retiree health-care fund controlled by the UAW is slated to get a 39 percent equity stake in GM for its remaining $10 billion in claims while bondholders are being pressured to take a 10 percent stake for their $27 billion? It’s highly unlikely that the auto industry professionals at GM would have cut such a deal had the government not been standing over them — or providing the steady stream of taxpayer dollars needed to keep the factory doors open.”—
The Obama administration bullies GM’s bondholders - washingtonpost.com
When Obama was derided as a would-be socialist during the campaign, such concerns were dismissed as reckless and irresponsible. A typical response went something like this: “Socialism means that the Government owns the means of production; Obama just wants to transfer wealth by readjusting taxes—that’s not socialism!”
Well, now we have a Government that owns the means of production. So maybe, just maybe, the campaign alarmism was spot-on.
Our leaders are often tarred with the worst characterizations … and then they become them.
The government could be exposed to a host of conflicts and potential unintended consequences if it ends up — as now appears likely — with a controlling stake in General Motors Corp.
General Motors Corp.’s latest plan to return to profitability calls for the struggling automaker to close five more plants than it originally expected. The lingering question is which plants will be the first to go.
Total: 1 of 1 Pages
