U.S. boosts estimate of auto bailout losses to $23.6B

[RockX]

The Treasury Department dramatically boosted its estimate of losses from its $85 billion auto industry bailout by more than $9 billion in the face of General Motors Co.'s steep stock decline.


In its monthly report to Congress, the Treasury Department now says it expects to lose $23.6 billion, up from its previous estimate of $14.33 billion.


The Treasury now pegs the cost of the bailout of GM, Chrysler Group LLC and the auto finance companies at $79.6 billion. It no longer includes $5 billion it set aside to guarantee payments to auto suppliers in 2009.


The big increase is a reflection of the sharp decline in the value of GM's share price.


The current estimate of losses is based on GM's Sept. 30 closing price of $20.18, down one-third over the previous quarterly price.


GM's stock closed Monday at $22.99, up 2 percent. The government won't reassess the estimate of the costs until Dec. 30.


The government has recovered $23.2 billion of its $49.5 billion GM bailout, and cut its stake in the company from 61 percent to 26.5 percent. But it has been forced to put on hold the sale of its remaining 500 million shares of stock.

http://www.detnews.com/article/20111114/AUTO01/111140434/1361/U.S.-boosts-estimate-of-auto-bailout-losses-to-$23.6B

 

[Onceler]

That's a truly peanutty amount, if you're able to comprehend the cost of inaction at any level.

 

[Cancel 2018. 3]

lmao....23 billion is now peanuts

only in the loony liberal mind

 

[Onceler]

lmao....23 billion is now peanuts

only in the loony liberal mind

It's cost/benefit, Yurt. The alternative is pennywise/pound foolish.

$23 billion is peanuts when you consider the losses to the American economy from October of 2008 through the spring of 2009, which was in the trillions. You can say, "we don't know how much not bailing out would have cost," but I feel pretty confident saying that the bailouts meant at least $23 billion to our economy in terms of saved jobs, saved manufacturing base, and saved peripheral economic effect.

 

[Cancel 2016.2]

That's a truly peanutty amount, if you're able to comprehend the cost of inaction at any level.

amazing how $23 billion is peanuts to liberals.

 

[Cancel 2016.2]

It's cost/benefit, Yurt. The alternative is pennywise/pound foolish.

$23 billion is peanuts when you consider the losses to the American economy from October of 2008 through the spring of 2009, which was in the trillions. You can say, "we don't know how much not bailing out would have cost," but I feel pretty confident saying that the bailouts meant at least $23 billion to our economy in terms of saved jobs, saved manufacturing base, and saved peripheral economic effect.

You are looking at only one side of the equation. Yes, it could have been worse. But there was NO need to have ANY loss. Tell me.... why do the unions have a large piece of ownership? Also, why is it that the companies are reporting 'profits', yet the taxpayers are in the hole? Do you think the government should have added that stipulation? That profits should have repaid taxpayers prior to any return to stockholders?

 

[Onceler]

amazing how $23 billion is peanuts to liberals.

Amazing how conservatives are unable to grasp the cost of the alternative.

 

[Onceler]

You are looking at only one side of the equation. Yes, it could have been worse. But there was NO need to have ANY loss. Tell me.... why do the unions have a large piece of ownership? Also, why is it that the companies are reporting 'profits', yet the taxpayers are in the hole? Do you think the government should have added that stipulation? That profits should have repaid taxpayers prior to any return to stockholders?

I think that the companies should have paid it back. But I don't care that much - in the scheme of things, it's not important. What was important was saving the jobs they saved, saving that portion of our manufacturing base, and saving the local economies that benefitted from those jobs.

If you think that isn't an amount that is quite a bit higher than $26 billion, you need to take a closer look at your calculations.

 

[Cancel 2016.2]

I think that the companies should have paid it back. But I don't care that much - in the scheme of things, it's not important. What was important was saving the jobs they saved, saving that portion of our manufacturing base, and saving the local economies that benefitted from those jobs.

If you think that isn't an amount that is quite a bit higher than $26 billion, you need to take a closer look at your calculations.

You don't care much? That $26 billion could have gone to creating other jobs, paying for medical subsidies etc....

I agree with you that the costs of doing nothing would have been higher... far higher. But that is NO excuse for losing money on the deal when the auto companies returned to profitability.

If you truly 'don't care' about $26Billion in losses, then please don't bitch when funding cuts are mentioned. Because you just gave a shoulder shrug to the government pissing away money that could have been used to avoid $26B worth of cuts or deficit spending.

 

[Onceler]

You don't care much? That $26 billion could have gone to creating other jobs, paying for medical subsidies etc....

I agree with you that the costs of doing nothing would have been higher... far higher. But that is NO excuse for losing money on the deal when the auto companies returned to profitability.

If you truly 'don't care' about $26Billion in losses, then please don't bitch when funding cuts are mentioned. Because you just gave a shoulder shrug to the government pissing away money that could have been used to avoid $26B worth of cuts or deficit spending.

I said I didn't care that much; in the scheme of things, it's a symbolic amount, and little more than that. You know the #'s. How can you argue that it's significant?

And there isn't much cutting that I don't support right now. SS, Defense (huge cuts), etc.

 

[Cancel 2018. 3]

It's cost/benefit, Yurt. The alternative is pennywise/pound foolish.

$23 billion is peanuts when you consider the losses to the American economy from October of 2008 through the spring of 2009, which was in the trillions. You can say, "we don't know how much not bailing out would have cost," but I feel pretty confident saying that the bailouts meant at least $23 billion to our economy in terms of saved jobs, saved manufacturing base, and saved peripheral economic effect.

pure speculation. you're trying to make your opinion fact and it is not working. you're trying to minimize the loss by claiming it "could" have been worse. we don't know that. fact remains, 23 billion is not peanuts. we would have survived without the false fix from the government.

 

[Cancel 2018. 3]

You don't care much? That $26 billion could have gone to creating other jobs, paying for medical subsidies etc....

I agree with you that the costs of doing nothing would have been higher... far higher. But that is NO excuse for losing money on the deal when the auto companies returned to profitability.

If you truly 'don't care' about $26Billion in losses, then please don't bitch when funding cuts are mentioned. Because you just gave a shoulder shrug to the government pissing away money that could have been used to avoid $26B worth of cuts or deficit spending.

how would the costs have been higher?

 

[Onceler]

pure speculation. you're trying to make your opinion fact and it is not working. you're trying to minimize the loss by claiming it "could" have been worse. we don't know that. fact remains, 23 billion is not peanuts. we would have survived without the false fix from the government.

It's some speculation. It isn't "pure" speculation. Anyone with a basic understanding of economics can look at the jobs saved, the effect on the surrounding economies & our manufacturing base, and make an educated guess as to the overall economic impact. It wouldn't be precise, but it's erroneous to suggest it's a wild guess, which "pure speculation" basically is.
\

 

[The Dude]

That is the cost of union votes. If gov motors did go down, ford and Chrysler would have been that much stronger. The had too argument holds as much water as the post office has to be open on weekends.

 

[Bonestorm]

You are looking at only one side of the equation. Yes, it could have been worse. But there was NO need to have ANY loss. Tell me.... why do the unions have a large piece of ownership?

Because the unions bought it.

Also, why is it that the companies are reporting 'profits', yet the taxpayers are in the hole?

Because the value of GM shares held by the government does not cover the government's initial investment.

Do you think the government should have added that stipulation? That profits should have repaid taxpayers prior to any return to stockholders?

How would that work other than barring the payment of dividends until the stock price meets a certain dollar amount?

 

[Cancel 2016.2]

Amazing how conservatives are unable to grasp the cost of the alternative.

Amazing how liberals think there was only ONE alternative.

 

[Cancel 2016.2]

Because the unions bought it.

No, they did not. They were GIVEN it.

Because the value of GM shares held by the government does not cover the government's initial investment.

Because again, the government did not make the loans guarantee return of tax payers money with profits.

How would that work other than barring the payment of dividends until the stock price meets a certain dollar amount?

That would be one way. In no way should other stockholders receive dividends while the tax payer loses money. Especially the unions who received stock they should never have received.

 

[Cancel 2018. 3]

It's some speculation. It isn't "pure" speculation. Anyone with a basic understanding of economics can look at the jobs saved, the effect on the surrounding economies & our manufacturing base, and make an educated guess as to the overall economic impact. It wouldn't be precise, but it's erroneous to suggest it's a wild guess, which "pure speculation" basically is.
\

what a whiny hair splitter. it is speculation, period.

 

[Cancel 2016.2]

That is the cost of union votes. If gov motors did go down, ford and Chrysler would have been that much stronger. The had too argument holds as much water as the post office has to be open on weekends.

I agree with Oncelor that the disruption to the suppliers would have wrecked havoc in the short term. Given the state of the overall economy, as much as I hate government action like that, it was necessary to stop the bleeding. That said, Ford ended up coming out at a disadvantage due to its NOT needing to be bailed out. Chrysler received bailout money just like GM.

 

[Onceler]

what a whiny hair splitter. it is speculation, period.

It's not a wild guess. Again, anyone with reasonable economic knowledge can look at the circumstances and conclude with some certainty that things would have been worse without the bailouts.

It's a real cop-out to unscientifically just say "it's pure speculation - we never can know." We can know w/ reasonable certainty.