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Thread: GM Falls Below IPO Price as Rising Oil Dims Truck Outlook

  1. #81
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    Re: GM Falls Below IPO Price as Rising Oil Dims Truck Outlook

    more "fox style" attacks

    from cbs---LOL!

    Mr. Obama said Americans are now "positioned to recover more than my administration invested in GM" as a result of the IPO, which reduced the government's ownership stake in the company from 61 percent to 36 percent, according to the Associated Press.

    According to the AP, for the government to break even on the bailout it will have to sell its remaining interest at an average of about $50 a share. GM stock closed today at $34.19.
    Obama: GM's Success Proves "Doubters" Wrong - Political Hotsheet - CBS News

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    Re: GM Falls Below IPO Price as Rising Oil Dims Truck Outlook

    Quote Originally Posted by The Prof View Post
    Saying "we are NOW in a POSITION" wasn't "promising a Profit" but offering a Hopeful outlook on the Eve of the offering.
    (and still may come to pass)
    It continues:
    "According to the AP, for the government to break even on the bailout it will have to sell its remaining interest at an average of about $50 a share. GM stock closed today at $34.19."

    The Offering price and amount of shares had been raised several times due to wide and strong investor demand.

    So the OP Remains a False claim.
    Last edited by mbig; 02-28-11 at 12:11 PM.
    I'm personally sick of not being able to dunk a basketball because of racism.
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    Re: GM Falls Below IPO Price as Rising Oil Dims Truck Outlook

    Here's how the Controversy started, and what's been pervertd by a few Blogs and alot of partisan Hacks.

    http://politifact.com/truth-o-meter/...ed-profit-mon/
    "In the first round of repayments" from financial institutions that received TARP money, "the government has actually turned a profit."
    Barack Obama on Tuesday, June 9th, 2009 in a statement at the White House
    Obama says government has so far turned a profit on money used to stabilize banks.



    Admit it: When the federal government decided last fall to spend hundreds of billions to stabilize banks through the Troubled Assets Relief Program, or TARP, you thought the money was as good as gone.

    Not so, President Barack Obama said at the White House on June 9, 2009.

    "Several financial institutions are set to pay back $68 billion to taxpayers," he said. "And while we know that we will not escape the worst financial crisis in decades without Some Losses to taxpayers, it's worth noting that in the first round of repayments from these companies the government has actually turned a profit."

    A quick summary of how we got to this point:

    As part of the TARP, the government invested about $200 billion in 600 banks across the country, essentially buying up preferred stock.

    A lot of banks now want out. The government money came with strings, including restrictions on executive compensation. Plus, there was a stigma attached to participating in the government program.

    On June 9, the Treasury Department announced that 10 of the largest financial institutions that participated in the Capital Purchase Program (through TARP) have been approved to repay $68 billion. Yes, they had to be approved to repay the money. The companies had to prove they no longer needed the money, because the government doesn't want them begging for more down the road.

    To date, those 10 companies have paid dividends on their preferred stock to the Treasury totaling about $1.8 billion, the Treasury announced. Overall, dividend payments from all of the 600 bank participants has come to about $4.5 billion so far. That's commensurate with the 5 percent (annualized) dividend return that was part of the terms of the program.

    Now, the government borrowed the money it invested in the banks, and so dividends from the preferred stock are offset by interest the government has had to pay on its loans. But that interest rate has been lower than the 5 percent dividend rate. So when the companies repay the loans, it will result in some profit to the government, banking analysts told us.

    There's another potential profit center. As part of the deal with banks, the federal government received warrants to buy stock at a future date (with the hope that as the economy improved and bank stock value rose, the government could share in the bounty). According to the Treasury announcement on June 9, firms that repay their preferred stock have the right to repurchase those warrants at fair market value. Experts believe that could fetch the government several billion dollars. That's in addition to the dividends.

    David John, a senior research fellow at the conservative Heritage Foundation, said that while it's accurate to say the government is turning a profit on these specific transactions, it was so costly to create the TARP that "you can't say the overall program is a moneymaker."

    And, John said, the 10 financial institutions that will be repaying the Treasury are among the strongest. It remains to be seen how the others will fare, he said.

    "It's way too soon to judge the entire program," John said. "I'd be surprised if it ends up anything better than break-even."

    Still, the public too often tagged TARP as a bailout, said John Hall, a spokesman for the American Bankers Association.

    "It's as if people thought money was handed out to banks," Hall said. "It wasn't. And it drove us nuts. The government has turned a profit. It made money plus some."

    Bank analyst Bert Ely said while the government may end up losing money on investments in some financial firms, it's likely the entirety of the bank portion of the TARP will ultimately turn a profit.

    The 5 percent paid in dividends on preferred stock purchased by the Treasury will certainly outpace the interest rate on money borrowed to finance the program, he said. And the warrants could also prove profitable.

    "People think the government gave banks money," Ely said. "They made investments in banks."

    As for Obama's claim, he is careful to note that the overall program could still cost taxpayers money, but he is correct to say the government turned a profit on the first round of repayments. We rate his statement True.
    Last edited by mbig; 02-28-11 at 12:02 PM.
    I'm personally sick of not being able to dunk a basketball because of racism.
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    Re: GM Falls Below IPO Price as Rising Oil Dims Truck Outlook

    Quote Originally Posted by mbig View Post
    Here's how the Controversy started, and what's been pervertd by a few Blogs and alot of partisan Hacks.

    PolitiFact | Obama says government has so far turned a profit on money used to stabilize banks
    "In the first round of repayments" from financial institutions that received TARP money, "the government has actually turned a profit."
    Barack Obama on Tuesday, June 9th, 2009 in a statement at the White House
    Obama says government has so far turned a profit on money used to stabilize banks.

    ....so those TARP dividend checks should be coming any minute now Big......
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    Re: GM Falls Below IPO Price as Rising Oil Dims Truck Outlook

    Quote Originally Posted by Badmutha View Post
    ....so those TARP dividend checks should be coming any minute now Big......
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    Thank you George Bush for creating TARP and the conditions that led to it's need and to leave office with an economy on the brink of depression. Thanks again for me not being able to retire when I had planned.
    "This Administration will constantly strive to promote an ownership society in America. We want more people owning their own home. It is in our national interest that more people own their own home. After all, if you own your own home, you have a vital stake in the future of our country."" GWB

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    Re: GM Falls Below IPO Price as Rising Oil Dims Truck Outlook

    All things being equal, those who are complaining about taxpayers not being paid back from TARP/GM bailouts should also still be pissed that we didn't get paid back from the Savings and Loan bailout where our loses were nearly double what they may be under TARP/GM.

    I've commented on this before, but the pundits really don't want to talk about it seeing that it's old news (and it happened on Reagan's watch). Well, I got news for you...

    This TARP/GM issue will one day be old news as well, but atleast we got a higher ROI on this bailout than we did on the last. Frankly, I'm not happy with either but what was done was done and the overall damage to the nation's economy was minimized. GM remains a viable U.S. automaker, people ARE working at their production plants and the economy is slowly improving (that is until gas prices put a big dent in any progress that was being made - DAMN!)

    So, if you really want to complain about something go back and research the S&L scandal and see if that bailout really helped the country as a whole or if it merely profitted a small few for a large sum on that taxpayer's nickle.

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    Re: GM Falls Below IPO Price as Rising Oil Dims Truck Outlook

    Quote Originally Posted by USA_1 View Post
    Thank you George Bush for creating TARP and the conditions that led to it's need and to leave office with an economy on the brink of depression. Thanks again for me not being able to retire when I had planned.
    Well dont forget to thank Senator Obama....The Democrat controlled Senate.....and Democrat controlled House.......

    ....without which....TARP would not have been possible.
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    Re: GM Falls Below IPO Price as Rising Oil Dims Truck Outlook

    hey, he never said we'd profit

    he just said we're positioned to recover more than we've invested

    LOL!

    meanwhile, some more "fox style" attacks

    Factbox: Taxpayers in deep water on GM investment | Reuters

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    Re: GM Falls Below IPO Price as Rising Oil Dims Truck Outlook

    Quote Originally Posted by mbig View Post
    They absolutely were broke and saved by the FED and Forced/arranged mergers.

    And at least get your wrong claims straight. That was the BUSH/Paulson "hype"/FACT.

    Another empty apparachik here.

    This board is full of one-line, know-nothing, Partsian Hacks who can't back anything they say and have no clue what they're talking about.
    It's Comical and sad.
    If you are talking about banks they sat on much of the money and sent some of it overseas. If you mean GM regular bankruptcy court would have worked but Obama did not want that because it would hurt the unions. So Obama moves in. He did not bailout GM he bailed out the unions and gave them a sweetheart deal. How much GM stock did the union get?

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    Re: GM Falls Below IPO Price as Rising Oil Dims Truck Outlook

    Quote Originally Posted by Badmutha View Post
    Well dont forget to thank Senator Obama....The Democrat controlled Senate.....and Democrat controlled House.......

    ....without which....TARP would not have been possible.
    .
    .
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    You're right it's their fault. Bush had nothing to do with it.
    "This Administration will constantly strive to promote an ownership society in America. We want more people owning their own home. It is in our national interest that more people own their own home. After all, if you own your own home, you have a vital stake in the future of our country."" GWB

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