U.S. Sells Remaining Stake in General Motors

[theworldismine13]

http://dealbook.nytimes.com/2013/12/09/u-s-sells-remaining-stake-in-gm/?hp&_r=0

The Treasury Department announced on Monday that the government had sold its remaining shares of General Motors stock.
The government has thus exited one of the most controversial investments made during the midst of the financial crisis, when it stepped in to rescue the Detroit automakers – a decision that as many as three in four Americans opposed at the time.

Taxpayers recouped about $39 billion on the investment, the Treasury Department said, having spent about $50 billion bailing out the automaker.

All in all, taxpayers have ended up in the black on the crisis-related bailouts, Treasury said: It has recovered $433 billion from the Troubled Asset Relief Program after initially investing about $422 billion.

“The president’s leadership in responding to the financial crisis helped stabilize the auto industry, and prevent another Great Depression,” Treasury Secretary Jacob J. Lew said in a statement. “With the final sale of GM stock, this important chapter in our nation’s history is now closed.”

The sale might be good for the company, too, analysts said. “This move does restore GM’s autonomy in terms of executive hiring and pay structure, which undoubtedly was impacting its ability to attract the best talent,” Karl Brauer, a senior analyst at Kelley Blue Book, said in an email. “While the term ‘Government Motors’ will no longer officially apply, it’s likely to be referenced going forward by the same, small number of buyers that would never purchase a GM product anyway.”

The Obama administration has argued that it could not have let the Detroit automakers fail during the worst downturn since the Great Depression and that the costs of the public investment outweighed the risks of letting them collapse.

Of the three Detroit automakers, two of them — GM and Chrysler — received federal aid. The Treasury said that all three, which includes Ford, were now “profitable, competitive and growing” and that American carmakers had created 370,000 jobs.

“When I took office, the American auto industry – the heartbeat of American manufacturing – was on the verge of collapse,” President Obama said in a statement. “In exchange for rescuing and retooling GM and Chrysler with taxpayer dollars, we demanded responsibility and results.”

Some economists have argued that the bailouts have saved the taxpayer money by keeping tens of thousands of workers on the job — and thus paying taxes and off of government support. A recent report by the Center for Automotive Research found that the bailouts “saved or avoided the loss of $105.3 billion in transfer payments and the loss of personal and social insurance tax collections.”

But the bailouts remain unpopular among many voters, and economists debate their ultimate effect on the economy. Many right-of-center analysts have criticized the government for stepping in to rescue the individual companies, thus effectively penalizing their competitors, they argue.

GM has returned to profitability, with car sales starting to pick up during the recovery. Most recently, it announced third-quarter earnings of about $700 million, on revenue of about $39 billion.

 

[88m3]

Taxpayers recouped about $39 billion on the investment, the Treasury Department said, having spent about $50 billion bailing out the automaker.

 

[DEAD7]

 

[ridge]

Taxpayers recouped about $39 billion on the investment, the Treasury Department said, having spent about $50 billion bailing out the automaker.

All in all, taxpayers have ended up in the black on the crisis-related bailouts, Treasury said: It has recovered $433 billion from the Troubled Asset Relief Program after initially investing about $422 billion.

 

[ill]

Govt turned a decent profit on the bailout. Its great that the taxpayers actually got an ROI but I think the bailout set a bad precedent for the future. Are we going to bail out the automakers and banks if they get in a similar situation?

 

[FaTaL]

Govt turned a decent profit on the bailout. Its great that the taxpayers actually got an ROI but I think the bailout set a bad precedent for the future. Are we going to bail out the automakers and banks if they get in a similar situation?

did they really have a choice?

they might be just delaying the inevitable

 

[Domingo Halliburton]

I remember Hank Paulson up there lecturing America on moral hazard.

 

[the cac mamba]

ima be honest, the fact that we ended up in the black on bailouts is fukkin shocking to me

assuming its true

 

[Yapdatfool]

Between cash for clunkers and the bailouts, automakers won huge in Obama's presidency.

 

[Domingo Halliburton]

ima be honest, the fact that we ended up in the black on bailouts is fukkin shocking to me

assuming its true

made 20 billion in interest off AIG

 

[Domingo Halliburton]

Between cash for clunkers and the bailouts, automakers won huge in Obama's presidency.

did they? Chrysler is owned by fiat now.

 

[Yapdatfool]

did they? Chrysler is owned by fiat now.

They sure as shyt did better than the American people, that's for sure. How much money did they get compared to us?

 

[Crakface]

Govt turned a decent profit on the bailout. Its great that the taxpayers actually got an ROI but I think the bailout set a bad precedent for the future. Are we going to bail out the automakers and banks if they get in a similar situation?

I hope so. When those bank stocks plummeted that investment was a slam DUNK!