Isn't This a Shocker! Federal Government's First Offering of GM Stock Will Be At a Loss To Taxpayers

I've said it a hundred, maybe a thousand times - name one time that the Federal government meddled in the affairs of the private sector in America where it DIDN'T completely mess the whole thing up. Just one, name one.

Well, when the Federal government and the Obama socialists decided that they couldn't afford to lose the votes of the UAW workers, they used our taxpayer money to buy a majority share of stock in General Motors - that failing behemoth of an automaker who had gotten into its mess by turning out cars that no one wanted to buy and by negotiating a union contract that made every car produced, unprofitable. So now, when it appears that the Fed will actually begin to get out of the State ownership of production in the Unites Socialist States of America, they have decided to sell their stock ....oh wait a minute, it's OUR stock, the peoples' stock....at a loss. Figures.

From the article at Reuters via Breitbart:

The U.S. government is likely to take a loss on General Motors Co in the first offering of the automaker's stock, six people familiar with preparations for the landmark IPO said.

Subsequent offerings of the government's holdings may be profitable depending on how investors trade the newly listed stock, the sources said.

But the question of whether taxpayers are ultimately made whole on GM's $50 billion bailout could be left open for years, the people said.

Treasury spokesman Mark Paustenbach declined to comment. GM spokesman Tom Wilkinson also declined to comment.

So, let's just make it perfectly clear here folks. Barack Hussein Obama and his Union boss cronies made a deal - Obama would take tax dollars collected from you and me and he would buy out General Motors so that the UAW workers wouldn't lose their jobs and the union bosses could still make their mortgage payments on their multi-million dollar mansions. And now, when it comes time for the government to get its grubby hands out of private industry, they are more than happy to return to you and me LESS money than they took from us. And they have no fucking comment.

So, the next time someone comes to your door asking you to support their Democrat candidate, be sure to remind them that the Democrats stole your money and repaid you at a loss and the next time you run into your neighbor, you know...the one with the "Buy Union" bumper sticker on his Toyota pickup...tell him to take his UAW membership and shove it up his ass.

Taxpayers may face initial loss on GM IPO: sources


(Reuters) - The U.S. government is likely to take a loss on General Motors Co in the first offering of the automaker's stock, six people familiar with preparations for the landmark IPO said.

Subsequent offerings of the government's holdings may be profitable depending on how investors trade the newly listed stock, the sources said.

But the question of whether taxpayers are ultimately made whole on GM's $50 billion bailout could be left open for years, the people said.

It could take more than three years for the Treasury to sell down its remaining stake in GM after the IPO, one person said. That would push a final accounting into the next presidential term.

A decision to price the initial GM shares below the cost to taxpayers would follow the usual Wall Street practice of giving the first investors in a new stock a discount, but it could also help allay investor concern in the face of the slow recovery of the U.S. economy and flat auto sales.

Preparations for GM's IP0 remain confidential. Both GM and the U.S. Treasury have declined to comment, citing restrictions by U.S. securities regulators.

The Obama administration has pledged to exit its investment in GM as quickly as possible while holding out the prospect that taxpayers could ultimately be paid back in full.

Treasury spokesman Mark Paustenbach declined to comment. GM spokesman Tom Wilkinson also declined to comment.

GM plans to begin a roadshow for its IPO immediately after the November 2, U.S. midterm congressional elections, paving the way for a stock debut on November 18, sources have said.

GM in August filed paperwork for an IPO that could potentially be worth as much as $20 billion, making it one of the biggest IPOs of all time.

The U.S. Securities and Exchange Commission is now reviewing the automaker's S-1 filing.

Analysts and potential investors have projected a market value for GM of between $50 billion to around $90 billion, based on projections for the automaker's cash flow, comparisons with rival Ford Motor Co and trading in bonds in the old GM, which are convertible into shares in the new company.

A market value at the high end of that range would be above the roughly $70 billion in market capitalization that GM needs to achieve for the U.S. government to break even on its $43 billion remaining investment in the automaker.

But IPOs typically price at a discount of 10 percent to 15 percent to theoretical fair value to reward investors for taking a risk on a new issue and pave the way for future stock floats. In tough market conditions, that discount can be even larger.

"You have to sell people on the notion that there is an upside to what they are buying," one of the sources said.

Another of the sources said the discount could be as much as 20 percent on the GM IPO compared with the U.S. Treasury's break-even point.

Preparations for the GM stock offering remain in the early stages. A number of the sources cautioned that the size and value of the deal and the size of the stake to be sold by the U.S. government have not been determined and will not be set for weeks.