GM Really Didn't Pay Back Loan

[Calabrio]

GM repays loan to US…actually, not really
http://radioviceonline.com/gm-repays-loan-to-us-actually-not-really/
April 22, 2010 at 3:41 pm by SoundOffSister


It was with great fanfare yesterday that General Motors announced that it was repaying some $4.7 billion of $6.7 billion in loans it received from the federal government. And, with even bigger fanfare, it was announced that this partial repayment was being made some five years earlier than expected.

Too good to be true? Well, it is.

What you weren’t told was that GM was able to repay the money by drawing down on a line of credit that it had from TARP! In other words, GM took funds still available to it through TARP and used those funds to repay the loan it received from the government. Of course, it now owes $4.7 billion on its line of credit with TARP, but, that doesn’t make for good news, so it wasn’t reported.

Here is how we know this. During an April 20 hearing on Capital Hill, Sen. Tom Carper, (D.DE.) asked some pointed questions of Neil Barofsky, the “special watch dog” on the Wall Street Bailout, aka, TARP.

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.”…

“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.”

Humm…wonder why we didn’t hear about that.

 

[fossten]

But but but...

foxpaws said they repaid the loan, so it must be true!

 

[PetesSweets86]

lolz, isn't that what a cadillac owner would say?

 

[Aquabrit]

Ya, I keep seeing a new GM commercial with Ed Whitacre basically boasting about how quickly they paid off their loan. I thought it seemed suspect. For as long as GM are tied up with the government, I'll not be a supporter of them.

 

[shagdrum]

lolz, isn't that what a cadillac owner would say?

Good point.

Ya, I keep seeing a new GM commercial with Ed Whitacre basically boasting about how quickly they paid off their loan. I thought it seemed suspect. For as long as GM are tied up with the government, I'll not be a supporter of them.

Ditto

 

[MonsterMark]

Ya, they repaid the loan with $3.4 billion in losses last quarter.

Our Country is sooooo F'd.

 

[PetesSweets86]

guess no one likes an overly priced vehicles that looked like it was drawn up by an "etch a sketch"

 

[Mechanicboy]

So to pay the government they borrowed from, the government? I wish they had paid me to make the decision lol.
I believe that GM can become profitable again so the money wasn't a total waste. However, I don't believe that chrysler will. Just my opinion, we shall see.

 

[fossten]

See, foxpaws won't respond to a thread like this. Then, a week later, she'll show up and say, what thread?

 

[PetesSweets86]

lol

 

[fastmark1993]

i love ford =]

 

[Aquabrit]

guess no one likes an overly priced vehicles that looked like it was drawn up by an "etch a sketch"

Agreed. The new wave of Cadillacs look pretty hideous, in my opinion. Camaro isn't much better. Current Corvette still looks pretty good, but no doubt that will change with the next generation.

 

[PetesSweets86]

Agreed. The new wave of Cadillacs look pretty hideous, in my opinion. Camaro isn't much better. Current Corvette still looks pretty good, but no doubt that will change with the next generation.

I think the next corvette might look like a Binder with headlights. Watch out for it's 3-ring exhaust! lol

 

[foxpaws]

See, foxpaws won't respond to a thread like this. Then, a week later, she'll show up and say, what thread?

4 days- starting Friday AM... coming back Monday evening...

If you want I can post my work schedule foss - since you have this rather unnatural need to know where I am at all times....

Foss-I even give you my schedule and you can't keep track?

Calendar challenged?

Heck, they paid some back - they could have kept the 6.7 billion (the total in loans they have paid so far) and handed it out in bonuses... they just were required to pay it back in 5 years. And by that time they may have been long gone...

6.7 billion back - even if it is our own money is better than zero back.

Get it?

And this will help them repay the rest...

Lincoln has nothing on that boys... I saw the CTS Coupe a couple of months ago in Detroit - it is beautiful... now they just need to make sure it comes in a 'V' (which Lincoln has no answer to either...)

 

[shagdrum]

So....redistributing money is now considered paying back money?

 

[foxpaws]

Shag - If I loaned you $500, and you paid back $100 - at least I am only out $400 now... Where does 'redistribution' come in?

I don't really care if that $100 came from my $500 - all I know is that my exposure is now only $400, which is better than being exposed to risk on the entire $500 which was the case initially.

 

[MonsterMark]

And the $52 Billion that was stolen from the Shareholders?
How does that sit with ya?

 

[foxpaws]

And the $52 Billion that was stolen from the Shareholders?
How does that sit with ya?

Stolen? When you buy stock it is a gamble - you might make a lot, you might lose it all...

GM stock holders knew the gamble-paid the price. When any company goes into bankruptcy, which GM had to do (whether or not the government had stepped in), bad things happen to the stock.

Stockholders are always on the bottom of the pile. Secured, unsecured, and finally stockholders.

And the 52 billion - where is that figure from? Was GM stock worth that when it declared bankruptcy?

 

[fossten]

Foss-I even give you my schedule and you can't keep track?

Calendar challenged?

No, I just don't care enough about you to pay attention.

Heck, they paid some back - they could have kept the 6.7 billion (the total in loans they have paid so far) and handed it out in bonuses... they just were required to pay it back in 5 years. And by that time they may have been long gone...

6.7 billion back - even if it is our own money is better than zero back.

Get it?

Truth challenged? How is GM going to be profitable when it is 100% subsidized by someone else?

And this will help them repay the rest...

Lincoln has nothing on that boys... I saw the CTS Coupe a couple of months ago in Detroit - it is beautiful... now they just need to make sure it comes in a 'V' (which Lincoln has no answer to either...)

Desperate words. People don't buy GM cars because they BREAK. Period. And show cars are bought by the rich - who Obama hates and is dead set on punishing - so this particular car won't move off the floor.

This isn't about LvC, this is about GM producing a viable product and actually generating its own profit, neither of which are happening.

 

[fossten]

Stolen? When you buy stock it is a gamble - you might make a lot, you might lose it all...

GM stock holders knew the gamble-paid the price. When any company goes into bankruptcy, which GM had to do (whether or not the government had stepped in), bad things happen to the stock.

Stockholders are always on the bottom of the pile. Secured, unsecured, and finally stockholders.

And the 52 billion - where is that figure from? Was GM stock worth that when it declared bankruptcy?

It's funny how you say "screw the stockholders, it's their dumb fault" and yet you support the bailouts, which remove the gamble/risk that companies take.

You're a walking mass of contradictions.

 

[fossten]

Shag - If I loaned you $500, and you paid back $100 - at least I am only out $400 now... Where does 'redistribution' come in?

I don't really care if that $100 came from my $500 - all I know is that my exposure is now only $400, which is better than being exposed to risk on the entire $500 which was the case initially.

The ends justify the means?

Sorry, fox, that dog won't hunt.

You CANNOT honestly claim GM paid the money back when they didn't. They're simply getting another bailout. Only this time, it WON'T be paid back, since it came from Obama's slush fund.

 

[foxpaws]

No, I just don't care enough about you to pay attention.

Truth challenged? How is GM going to be profitable when it is 100% subsidized by someone else?

So, you do finally understand that getting any money back, even if it is our 'own' money is better than getting nothing back... glad I could clear that up for everyone. Our risk in GM is 6.7 billion dollars less than it was...

Desperate words. People don't buy GM cars because they BREAK. Period. And show cars are bought by the rich - who Obama hates and is dead set on punishing - so this particular car won't move off the floor.

This isn't about LvC, this is about GM producing a viable product and actually generating its own profit, neither of which are happening.

The CTS Coupe isn't a show car - it will be in the showrooms in 2 months - for a price of around $38,000... a cow catcher front end MKS runs $41,000

I have owned many GM cars - they don't break any more than the Fords (Found on Road Dead) I have owned. However, both break more than the import cars I have owned (Japanese and German).

And GM is still selling more than Ford (as of April 1st), a pretty good feat after going into bankruptcy - hard to sell a car if people don't think you will be around next year.

GM will do just fine... We will be getting back our money. The fact that they didn't need that 6.7 billion they paid back is a pretty good indication...

 

[foxpaws]

The ends justify the means?

Sorry, fox, that dog won't hunt.

You CANNOT honestly claim GM paid the money back when they didn't. They're simply getting another bailout. Only this time, it WON'T be paid back, since it came from Obama's slush fund.

What new bailout Foss?

And are you really that fiscal knowledge impaired that you don't understand that getting some money back is better than getting nothing back?

 

[fossten]

What new bailout Foss?

And are you really hat financially impaired that you don't understand that getting some money back is better than getting nothing back?

Go back and read the OP. GM is using TARP money to pay off its debt. That's a bailout.

Who is getting their money back? Is Obama going to rebate us the TWENTY TRILLION DOLLARS he borrowed/printed/conjured up? When did he announce this? And what form will it take - rebate, tax cut, what? And where will the money come from, considering the TWENTY TRILLION DOLLARS didn't come from anywhere in the first place? China? We already know it can't come from GM - they can't even pay back their bailout themselves.

Are you really that truthfully impaired that you don't recognize the difference between robbing Peter to pay Paul, and actually paying back debt yourself?

I guess you really can't read. You're just playing dumb...or are you?

 

[shagdrum]

Shag - If I loaned you $500, and you paid back $100 - at least I am only out $400 now... Where does 'redistribution' come in?

You are already misleading with a false analogy.

The more accurate analogy is that you loan me $500 and set up an escrow account for me. Then I use the money in the escrow account to "repay" the $500 loan.

If you ignore that fact I highlighted, you are misleading.