Posted tagged ‘stock’

Another Bailout for GMAC? Seriously?

October 28, 2009
From Clusterstock:
Tim Geithner’s getting ready to shovel more taxpayer money down the rat hole, this time to GMAC.

GMAC, in case you’re in understandable denial, has been bailed out twice already.

And now Tim Geithner wants to shovel another $2.8 billion in.
What is the US taxpayer getting in exchange for all these GMAC bailouts?

Preferred stock.

Why are we getting preferred stock, which is neither a claim on the future upside of the company’s equity, nor a senior debt security that will be completely repaid in the event that taxpayers finally get mad as hell and won’t take it anymore?

Because Tim Geithner is worried that if he makes the folks who voluntarily lent money to GMAC — the bondholders — lose so much as a cent, the entire US economy will collapse.

Unbelievable. Sooner or later something has to give. And when it does, it won’t be pretty.

The Bailout is Working!?

December 7, 2008

Well, maybe it’s working for somebody.

Neel Kashkari, buddy of Henry Paulson’s from Goldman-Sachs and now overseer of the U.S. Treasury’s $700 billion financial-rescue plan, said yesterday, “We are confident we are pursuing the right strategy to stabilize the financial system and support the flow of credit to our economy.”

Interesting comment considering that, according to the Associated Press,  stock in the program intended to eventually earn taxpayers a profit has lost almost one-third of its value — nearly $8 billion — in barely one month.

We’re never going to see any of that money again, much less a profit. You can’t stop a market correction. Slow it down a little bit, for a little while, maybe, but you can’t stop it.