Bailouts

Joe Biden Is So Sentimental That He Wants To Keep Part Of GM As A Keepsake

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It's rude to point.

We're not through with GM yet! (Maybe.)

Vice President Joe Biden reiterated Monday that the U.S. government may maintain an ownership stake in General Motors Co. beyond this year, as the auto maker prepares to return to the stock markets as early as this fall.

"I don't know if you get totally out of GM" by the end of this year, Mr. Biden told reporters during a tour of Chrysler Group LLC's Toledo, Ohio, assembly plant, where the Jeep Wrangler is made. "I think that IPO will be successful."

Mr. Biden added that the car industry turnaround has been "very successful" under the Obama administration.

Very successful? I know some folks who might disagree, but I suppose it's all in the eye of the beholder. If by "very successful," Biden means "took a massive loan from the government, then paid (part of it) back with a separate pot of government money," then yes, GM has been quite successful.

NEXT: Zombie Cash

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  1. “Biden means “took a massive loan from the government, then paid (part of it) back with a separate pot of government money,” then yes, G.M. has been quite successful.”

    Considering that Biden has spent his entire life in government service and that is pretty much how the federal government has been operating for about 70 years now, it is not surprising at all Biden considers GM a success.

    1. Pay no attention to that other pot of fool’s gold behind the curtain.

    2. If by “very successful,” Biden means “took a massive loan from the government, then paid (part of it) back with a separate pot of government money,” then yes, GM has been quite successful.

      You forgot to mention “and stole 30 billion dollars from secured creditors and gave away a huge portion of the company to the unsecured union creditors as a sop to union votes.”

    3. So check kiters are financial success stories?

  2. If GM can’t get momentum out of that ditch it’s in, I heard nothing adds traction like throwing more tax dollars under the tires.

  3. Maybe he wants GM to take a stab at building trains.

    1. Does Prince Joe even know how to drive a car?

      1. Hand/eye coordination is for little people.

      2. He employs real Americans in real American jobs, like driving his car and scrubbing his redacted.

      3. Fuck, yeah, dude. He has a sweeeet Trans Am:

        http://www.theonion.com/articl…..-dri,2718/

      4. Biden has or at least had a beautiful Corvette. At my high school in Delaware, many years ago, after lecturing us about how we needed to conserve energy and be less greedy, Jolting Joe left the auditorium and got into a beautiful blue corvette stingray.

    2. Ah, maybe this is the joke so if so I apologize. But actually GM makes lots of trains and has done so for years.

      http://en.wikipedia.org/wiki/List_of_GM-EMD_locomotives

      1. Didn’t know that actually, I was just making a Biden joke. Interesting.

      2. GM hasn’t owned EMD for a long time. EMD is privately held and Caterpillar is bidding to purchase it.

        1. It is a good company that makes a great product. So of course GM got away from it. My mistake for not thinking that one through.

    3. Wow- that would reverse the great street car scandal of the 60’s-

      National, which had been in operation since 1920, was organized into a holding company, and General Motors, Firestone Tire, Standard Oil of California, Phillips Petroleum, Mack, and the Federal Engineering Corporation made investments in the City Lines companies in return for exclusive supply contracts. Between 1936 and 1950, National City Lines bought out more than 100 electric surface-traction systems in 45 cities, including Detroit, New York City, Oakland, Philadelphia, Phoenix, St. Louis, Salt Lake City, Tulsa, Baltimore, Minneapolis, and Los Angeles, and replaced them with GM buses.

      1. Urban myth. Streetcars were in decline by the 1920’s. Buses allowed for more flexibility in mass transit:
        new developments could be serviced quickly without building elaborate street car tracks, easy to go around a broken down bus while a trolley could clog up the line for hours.

      2. Sure, but streetcars went away in cities that didn’t sell out to National, too.

        The underlying problem was that various factors (including the Public Utility Holding Company Act, which made it illegal for publicly regulated electric companies to cross subsidize their nonregulated electric streetcars) made streetcars unprofitable.

        Streetcars became unprofitable, so they were replaced everywhere. National won a lot of contracts to replace streetcars with buses, and used some sweetheart deals to beat out other bus operator competitors. But that was just fighting over who would replace streetcars.

  4. If GM wants to get the “right sort” of people behind their “partnership” with the Government they should look into incorporating human embryos into the design.

  5. Isn’t the conventional wisdom that almost nobody is going to buy into the GM IPO, because it’s still a shit company?

    1. UnAmerican conventional wisdom.

    2. Thats what union 401ks and pension funds are for. Can you say Global Crossing?

    3. I find it is wise to invest in companies than can make a profit.

  6. Mr. Biden added that the car industry turnaround has been “very successful” under the Obama administration.

    I’m sure there are a lot of people using GM stock (and bond) certificates as wallpaper in their bathrooms who might disagree.

    My new nightmare scenario is this: the Fed will come in either openly or by stealth, and gobble up a big chunk of the IPO, to guarantee its “success”.
    Because there is nothing they cannot do.

    1. The Fed just lost its FOIA request with Bloomberg and there’s infighting over QE, so maybe that institution will sit this one out.

      Mutual and pension funds will buy the IPO because sitting on cash does not pay management the fees they’re entitled to.

  7. “Hey you, in the back with the wooden leg! Run your ass on up here and take a bow!”

    (sorry, that just doesn’t get old)

  8. ‘Shirtless Biden washes Trans Am in White House driveway’ was one of the funnier Onions in a while. Too bad the boob’s a cheerleader and not much else.

  9. Isn’t the conventional wisdom that almost nobody is going to buy into the GM IPO, because it’s still a shit company?

    Whuuut?

    Don’t you watch CNBC? New! improved! Governal Moteurs is a FABULOUS company; a rampaging success which any real red-blooded American would be proud to call his own!

  10. Tony Jackson in the FT argues pretty convincingly that GM is now a hedgefund in diguise. And not a very appealing one at that.

    [can’t make the link work w/o reg. page, but google tony jackson gm pension]

  11. Not that I’m vindictive, but I hope Biden only gets to drive GM products for the rest of his life.

    1. Awesome! Lots of renters might finally be able to afford a house that was once way overpriced.

  12. Pull my finger!

  13. LOL, Joe Biden is such a d-bag.

    Lou
    http://www.isp-logs.es.tc

    1. +1 for the bot.

    2. Is that you in there, Max Talbot?

  14. This is what always happens whenever the government tries to bring the American people auto manufacturing reform.

    Some guy with a computer and lots of free time (Suderman in this case) starts stirring up trouble.

    I’ve already sent this link to flag@whitehouse.gov and will do so again if you post another piece of vicious anti-government lies.

    1. I heard he’s a racist, too.

      1. Either this guy is an incompetent satirist, or he’s a narc for Big Government.

    2. Make sure to add my name to the list, dickhead.

  15. Two questions about GM

    (1) What were the fundamental structural problems that caused it to go bankrupt?

    (2) Have they been fixed?

    If the answer is no, and I suspect it is, then don’t buy their stock.

    1. I’m really interested to see how the IPO plays out.

      At some level, if you’re confident that the government will back GM no matter what, maybe you get in on that action.

      1. They’ll back the company to the extent that it is a shell to funnel money to their supporters in the union. They don’t give a shit about the people buying stocks any more than they cared about secured creditors or bankruptcy law.

    2. (1) Not enough regulation.

      (2) Government ownership.

    3. Listen, listen. Let’s focus less on change, here, and more so on hope.

    4. Remind me again: Is government control of GM socialism or fascism?

      1. socialism or fascism?

        You misspelled “and”.

        1. Oh, so I did. Thanks!

    5. “Two questions about GM

      (1) What were the fundamental structural problems that caused it to go bankrupt?

      (2) Have they been fixed?

      If the answer is no, and I suspect it is, then don’t buy their stock.”

      UAW legacy pension/health benefits. Retired UAW workers get paid so much money, it would make local government blush. And they aren’t producing anything. They add nothing to GM’s bottom line.

    6. (1) one too many car companies in the US.
      (2) no

  16. How “sucessful” does the IPO have to be for the government to make back the money they exchanged for GM stock during the bailout?

    I find it unlikely that it will be anyway near that sucessful. And it’s important to remember that the part of the TARP funds they paid pack is NOT the massive original bailout which the government bargained in exchange vfor GM stock during the administration-brokered “backruptcy”.

    1. oops, I should have spelled that “backrubcy”.

    2. According to ProPublica…

      On GM itsel, $7 billion has been returned, 51 billion remains dispersed, and the government has made $600 million in revenue.

      On GMAC, 16 billion has been dispersed and none of it has been paid back, and unless there’s something I misunderstand about that, the chances of us ever recovering anything from GMAC is pretty close to nil.

      http://bailout.propublica.org/list/index

      Now that’s just TARP. There will almost certainly be some window dressing done here–like what we saw with the shell game around what GM already returned.

      It isn’t clear what the American taxpayer’s ongoing contribution/liability will be to GM once it’s privatized either–at least it isn’t clear to me.

  17. I have heard $60/share as the “magic number” which would repay the government’s investment bailout.

    I don’t expect to see that on the ticker. Ever.

    1. Unless the Fed buys it all.

    2. You aren’t taking into account the magic of double digit inflation.

      Now, an inflation-adjusted $60/share? No freakin’ way.

    3. Not to mention…GMAC.

      Are they spinning off GMAC?

  18. if you’re confident that the government will back GM no matter what

    Of course, if you’re confident they’ll fuck you just as they fucked the previous set of shareholders, you might keep your hands in your pockets.

  19. Mr. Biden added that the car industry turnaround UAW bailout has been “very successful” under the Obama administration.

    1. We have a winner.

      So far the teachers unions have been paid off and the UAW has been paid off. Who’s left? I suppose we’ll probably see another round of stimulus before the 2012 elections to make sure the Dem’s core stays nice and happy.

  20. An interesting article explaining the IPO and the loses or gains expected. It would seem that there is a good change the public would lose more money if the treasury tried to offer up the full 61 percent all at once.

    However I can also see the treasury under Obama trying to keep the public ownership of GM above 33%, which when combined with the UAW’s 17.5% would give them a majority voting block.

  21. This was as predictable as the sunrise.

    If they hold on to a portion, then they don’t have to take the heat for all the money the American taxpayers lost–they can always say the jury’s still out on how much money they lost because they haven’t sold the last of their stake yet.

    That’s all it is really–it’s a CYA maneuver.

  22. “I don’t know if you get totally out of GM” by the end of this year, Mr. Biden told reporters during a tour of Chrysler Group LLC’s Toledo, Ohio, assembly plant, where the Jeep Wrangler is made. “I think that IPO will be successful.”

    In other words, they haven’t determined yet whether having GM off the government’s books before the elections in November is going to help them in the upcoming elections or whether it’ll hurt them…

    …but if it has to happen–by hook or crook–they’ll make sure it’s a success.

  23. TO THE WEAK-KNEED REPUBLICANS AND DEMOCRAT—-Wake up america!!!! This goverment is the most corrupt we have had in years. The good old boy network is very much in charge.Mr. obama and pelosi are the puppet masters.How many of their good friends benefited by the agreement ” what a farce. All of the u.sSenators voted for this. I am ashamed to say I voted for the these corupted self serving politicians.With good reason they picked an out of towner to be president.All u.s departments need an overhaul. We need to rid ourselves of the puppet masters and the dept heads that bow down to obama and pelosi.I am sick of the lip service I have been getting from these dummies over violations, their friends are getting away with.in the goverment . Barack Hussein Obama , threatens friends and bows TO Mmslim.
    INPEACH OBAMA ,GOD OPEN YOUR EYES.///For us there are only two possiblities: either we remain american or we come under the thumb of the communist Mmslim Barack Hussein OBAMA. This latter must not occur.THE COMMANDER.REPOST THIS

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