U.S. Hurries to Sell GM Stake

U.S. Hurries to Sell GM Stake http://tinyurl.com/3h4or43

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A sale within the next several months would almost certainly mean U.S. taxpayers will take a loss on their $50 billion rescue of the Detroit auto maker in 2009.
To break even, the U.S. Treasury would need to sell its remaining stake —about 500 million shares—at $53 apiece. GM closed off at $29.97 in 4 p.m. trading Monday on the New York Stock Exchange, hitting a new low since its $33-a-share November initial public offering.
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On 4/21/11 7:26 AM, Bjorn wrote:

GM = Gone Missing
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Whether assisting GM through the bankruptcy was a good idea or not is open for debate.
Keep owning it is surely not a good idea so whatever they get for the stocks now does not matter.
They are even better off just giving the shares away for free.
GM is doomed again it seems whatever happens because they have not managed to do anything of real value.
The VOLT may or may not be a good idea but whatever it is then it is so small compared to the rest it is next to meaningless at this point.
For awhile there I was beginning to think that they might have pulled off saving some of GM but that was an illusion.
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a lot of folk are very happy with their volts, just that it is priced quite high and suplly is very limited as well
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On 23/04/2011 6:50 AM, raamman wrote:

Wait until the real howling begins when the Lithium batteries need to be replaced. Don't gve me warranty crap either, it is full of deliberate holes that let GM off light. And if GM does by chance offer replacements, well, good-bye money.
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On 22/04/2011 4:17 AM, Bjorn wrote:

You can polish a turd, but it is still a turd.
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On 21/04/2011 5:56 AM, Jim_Higgins wrote:

Good-bye Money. Greedy Motors Government Motors
Best thing shareholders could do is spin off the only part of GM worth a dime, make GM China its own company and sell it back to the Chinese.
I would actually buy some shares in GM China if they didn't have to deal with the rest of GM dead weight. Especially if they were valued in Yuan and paid a small dividend in Yuan.
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On 21/04/2011 5:26 AM, Bjorn wrote:

Maybe the government is getting good advice? Cut your losses.
Government knows we are well into another downturn. The 2/3rds of the world is doing well keeping commodity prices high but the US economy is cratering from debt.
Sort of like for every car US families give up for increasing costs, increasing taxes, stagnant wages and job losses, China buys 2 and India buys one and Brazilians buy one.
US Treasury and US Fed, Bernake and others are now seeing the damage of print your debt with no-value money. To choices, raise interest rates or watch the USD become worthless.
In any case, that is less auto sales in the USA. And you want to get out before GM blows up AmeriCredit like they did GMAC.
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Interestingly then eeping the Yuan low valued and tight to the dollar is creating heavy inflation in both china and the US.
There are a hell of a lot of people getting very rich in china and the chinese government have lost control of the economy and can not do much about it.
They have a huge problem on their hands because they have so many very poor people and can not let the prices rice as much as is needed and are trying to balance something they have no control over.
At the same time the US has a problem of having so much of dollars tied up in china and it is a sure thing those dollars will come back on day and create havoc in the US when they do.
There are already signs that big international deals that have trditionally for a few decades been done in dollars are now brokered in yuan, rubles and euros.
The escalating price of oil and gold in dollars is a sure proof that the dollar has lost its appeal as a safe currency and it is sure to lose more and more and what will then happen will be interesting.
Will the US stick to the dollar and let hyper inflation make everything become extremely expensive or will they go over to a new currency?
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On 24/04/2011 3:06 AM, Bjorn wrote:

China is showing a small and progressive slow slip in supporting the USD. I expect this to continue and perhaps accelerate.

But their economy is still expanding and adding to the middle class.

Their "poor" class is shrinking while US is expanding.

You mean the other way around. China is its own currency, internally China uses Yuan not dollars. They have US dollars because of long term trade imbalances. And if you add in Chinese foreign purchases, China is reducing its hold on USD. Certainly isn't lending DC any more dollars, their poor credit debtors denial behavior an all.
Hey, never lend to someone who can't pay you back with real money. US Fed had to recently create $600 billion in one go so US Treasure could honor payment of maturing T-Bills or US would have been in default. Trouble was, it was all inflationary no-value money used and why oil is going up.

You can't just go to a new currency. No one will trust it. That is why gold is a better bet. And the new currency would unlikely be accepted as a new world reserve. And the new currency would have the same problems, government ponzi fraud money creation.
What is more likely is a return to precious metals but it might take 2 decades.
IMF is really ignoring the problem, that is governments must back up their fiat currencies to zero inflation. For if they do not, this recession/depression may last many decades.
Who knows, maybe the Yuan is a good candidate for a world reserve to replace the USD? Good part is I can now trade in Yuan. If China ever let the USD float, I suspect Yuan and USD would settle in at par. But China would have to write down the value of two trillion or so...a big value hit.
Hyper-inflation for the US is now inevitable. I don't think the government could raise rates hgh enough to stop the wall of inflation due to currency devaluation. But they can make it worse by keeping on this "In Debt We Trust!" mentality. It will ruin the USA in time and may take a generation or two to fix.
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No.
By keeping the yuan value low compared to the dollar the wages in china are low and they can sell a lot to the US and that means they export a lot and they get a lot of dollars and have trillions of dollars in reserve.
That makes a lot of chinese very rich even if the majority of them is dead poor.
The number of people in china are estimated to be from 1.300.000.000 to 1.600.000.000 so you see that the number of people in the US 300.000.000 disappear in the uncertainty of their number.
They are in a dilemma because there are so many poor and they have a hard time containing the imported inflation caused by the companies selling abroad cheap products sold in wallmart.
The US has an opposite problem of losing jobs to china, india, mexico because the wages are so much higher in the US.
So what do you do?
Make the yuan worth more?
That is what the US wants but the chinese are stuck in a mud full of bad choices.

Most of the $600 billion went to big companies like GM who sent the money straight to china and is at the moment causing inflation there.
When the money eventually will come back to the US it will cause inflation in the US never before seen anywhere.

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On 25/04/2011 2:00 AM, Bjorn wrote:

That will not occur. US currency is diluted too much, in the coming decade the "wall of money" as it is called will unwind in the US economy for about 300% inflation. As it does, wages will be stagnant.
You can't just print money like toilet paper or it becomes toilet paper.
One day China is going to stop propping up the USD and let it collapse. As it does, expect a gallon o gasoline to go north of $10/gallon.
It is why I own a lot of precious metals like gold. Government can print and devalue money all it wants, my gold is still gold and will purchase about the same amount of stuff.
The real problem is our society can't afford the size of government we have. And in time it will collapse, just like Roman times.
No amount of union rant is going to change it either.
And as it happens, make those autos cheaper, better and faster or the competition will eat your lunch.
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It is funny how unions can drag its members down
US steel was very strong and when new technique came along the union had a choice of letting their companies participate and the new technique would save a lot of money for the companies.
The new technique needed less than half the labor so the unions said NO.
That meant that other companies started with the new techniques and the old companies died.
So the unions lost 100% of the jobs instead of 50%
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On 01/05/2011 1:42 AM, Bjorn wrote:

Yep.
I am not per say anti-union in all cases. I actually see the need for them in some case, but they have far too much power.
Say a student needs to fail a grade, then the irrational parent decides they want the teacher fired and the principle is a knee jerk...unions are good here.
But just striking for high wages and low work...holding the organization for ransom? Or to defend obvious dead weight? You lost me. The threat of losing a job for bad performance does increase productivity and does reduce waste.

Yep. Close a plant, move to another location that is non-union is often the best way to deal with it.

Often happens. As an investor I support such activities.
I have actually been a union member on 3 occasions in my work career with a mix of union and non-union. I actually think non-union get a better deal. First, no union fees. Second, one clear reporting structure -- often union and management put a defenseless employee in the middle of a top level bickering fest. And more too.
I prefer non-union.
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You'd benefit enormously from learning about the history of this country regarding the treatment of workers by corporations before the advent of collective bargaining.
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On 03/05/2011 9:52 AM, That Tune wrote:

Society has evolved quite a bit from the union thuggery days. Trouble is unions haven't.
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Is it possible to get anything for a penny?
How long until the pennies will be eliminated altogether.
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that WAS the plan though, wasn't it ?
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On 4/20/2011 1:50 PM, Jim_Higgins wrote:

In the news today was that GM was set to take over from Toyota for the #1 auto-maker in the world slot... Seems their sales in China are booming, and Toyota is having trouble recovering from the quake and wave. But even without the natural disasters that Toyota faces, they were running neck and neck anyway.
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