Will GM Go Bankrupt Again?

The government is holding $10.1 billion worth of stock and sitting on an unrealized loss of $16.4 billion.

President Obama is proud of his bailout of General Motors.  That's good, because, if he wins a second term, he is probably going to have to bail GM out again.  The company is once again losing market share, and it seems unable to develop products that are truly competitive in the U.S. market.

Right now, the federal government owns 500,000,000 shares of GM, or about 26% of the company.  It would need to get about $53.00/share for these to break even on the bailout, but the stock closed at only $20.21/share on Tuesday.  This left the government holding $10.1 billion worth of stock, and sitting on an unrealized loss of $16.4 billion.

Comments

[Aresen]

I hope so.

But it will not be allowed to happen before November 7, 2012.

[Ralph Wylie]

At least with Solyndra it was only a one-time fleecing of the US taxpayers. GM (aka Government Motors)just can't get it's nose out of the hog trough. It's time to just let GM die, declare bankruptcy and take union boss Obama with them.

[Robert]

The teaser said "losses far larger than the company's total value". Presumably that's an annual loss. And they're only, as the teaser said, "on the verge of bankruptcy"? Operating losses that great are the sort of thing you'd expect in a startup that needs to raise more capital to stay in business. Who would be so optimistic as to lend GM money like that now?

[Robert]

This left the government holding $10.1 billion worth of stock, and sitting on an unrealized loss of $16.4 billion.

Well, at least if they cash out, they can take that off their income for tax purposes.

[Michael Price]

Oh thank god it's only $16.4 billion, I thought we might have been talking about real money. Hang on that's my annual income for every year since chromosomal Eve was being courted.