Govt sells last of GM shares, taxpayers 10.5 billion loss

[AZGrizFan]

Just curious. Why did the government sell the shares when they did? Why not wait another year and possibly reap the benefits of a higher price per share? Was there a time limit? The price is currently at a peak of it's post-bailout era. The Treasury sold the "remaining 31.1 million shares" recently out of the 500 million shares it once had. When did they sell the other 469 million shares? When it was half the current price?

This result seems like poor investment strategy more than anything.

I believe it was a set timeframe to avoid driving the market. They did the same thing with AIG stock. Being a huge shareholder but not trying to interrupt the private marketplace on the exit like they did on the entrance.

Terrible investment strategy for the Gov't but i think a necessarily evil for the good of the greater market.

Yeah, there's nothing like knowing EXACTLY how many shares the Gov't is going to put on the open market every month. That wouldn't impact the market price at all.

[danefan]

I believe it was a set timeframe to avoid driving the market. They did the same thing with AIG stock. Being a huge shareholder but not trying to interrupt the private marketplace on the exit like they did on the entrance.

Terrible investment strategy for the Gov't but i think a necessarily evil for the good of the greater market.

Yeah, there's nothing like knowing EXACTLY how many shares the Gov't is going to put on the open market every month. That wouldn't impact the market price at all.

Of course it does, but it happens once. The government sets the timeline and the market (if efficient at all) should price it in. Predictability is better, IMO, then a pure guessing game.

I'd rather that then some guy in Washington deciding when and how much to sell.

[CAA Flagship]

Yeah, there's nothing like knowing EXACTLY how many shares the Gov't is going to put on the open market every month. That wouldn't impact the market price at all.

Of course it does, but it happens once. The government sets the timeline and the market (if efficient at all) should price it in. Predictability is better, IMO, then a pure guessing game.

I'd rather that then some guy in Washington deciding when and how much to sell.

But if GM was not on stable ground, why have a set date at all. One small hiccup and they may have to do it all over again. Was the 500 million shares sold in 1 week, 1 month, or over several months? I just don't know why a time limit was imposed when we are talking about taxpayer money. That is like options trading which we all know is risky. I really don't know, but please tell me the timing of the sale of all the shares make any sense.

[AZGrizFan]

Yeah, there's nothing like knowing EXACTLY how many shares the Gov't is going to put on the open market every month. That wouldn't impact the market price at all.

Of course it does, but it happens once. The government sets the timeline and the market (if efficient at all) should price it in. Predictability is better, IMO, then a pure guessing game.

I'd rather that then some guy in Washington deciding when and how much to sell.

The feds lent GM $49.5 billion. For this they were given 912 million shares of common stock. The breakeven point on the common stock was roughly $43.67 per share. The Government sold 412 million of those shares at GM's IPO in November of 2010 for $33/share, GUARANTEEING the government a loss. The stock crashed all through 2011 and most of 2012, closing in mid-2012 at under $20/share. It has since recovered to just over $40/share. Even if they had held all 912 million shareas to date they'd STILL be under water. And do you know what GM's biggest rallying point was at the completion of the sale this week? "Yay, we can now pay senior executives whatever we want without the government telling us what to do!" They've made a profit for 3 consecutive quarters....lets see how long THAT lasts--they didn't learn a thing.

*Note: Unions made a similar sale right after the IPO that resulted in a $4 billion PROFIT to their pension fund.

An interesting read:

http://gaanderson.hubpages.com/hub/Obam ... ld-Details" onclick="window.open(this.href);return false;

[Chizzang]

Of course it does, but it happens once. The government sets the timeline and the market (if efficient at all) should price it in. Predictability is better, IMO, then a pure guessing game.

I'd rather that then some guy in Washington deciding when and how much to sell.

The feds lent GM $49.5 billion. For this they were given 912 million shares of common stock. The breakeven point on the common stock was roughly $43.67 per share. The Government sold 412 million of those shares at GM's IPO in November of 2010 for $33/share, GUARANTEEING the government a loss. The stock crashed all through 2011 and most of 2012, closing in mid-2012 at under $20/share. It has since recovered to just over $40/share. Even if they had held all 912 million shareas to date they'd STILL be under water. And do you know what GM's biggest rallying point was at the completion of the sale this week? "Yay, we can now pay senior executives whatever we want without the government telling us what to do!" They've made a profit for 3 consecutive quarters....lets see how long THAT lasts--they didn't learn a thing.

*Note: Unions made a similar sale right after the IPO that resulted in a $4 billion PROFIT to their pension fund.

An interesting read:

http://gaanderson.hubpages.com/hub/Obam ... ld-Details" onclick="window.open(this.href);return false;

We covered this already AZ
They are acting like nothing happened / Same old GM
We can all anticipate a HARD decline in profitability in the coming years from GM



This is NEWS to no one... except a few posters on here

[grizfnz]

Bottom line, how much can we deduct on our taxes this year for the business loss we invested in?

[BDKJMU]

GM recalling 370,000 POS for fire risks:
http://www.detroitnews.com/article/2014 ... |FRONTPAGE" onclick="window.open(this.href);return false;

Another reason we shouldn't have bailed them out...