http://www.247wallst.com/2008/08/gm-gm-wants-a-l.html ........................................................................................ Perhaps its time to change ownership tactics. If the government funds public companies, perhaps it should do so while respecting capitalism. The government would gain ownership in return for funds, acting much like a huge vulture fund....with the mandate that the company ownership will be just like any other, done in such a way as to make money for its shareholders, namely the tax payers..... Nothing wrong with buying F for $3....then later selling for $100 in the name of the tax payer.... Nothing wrong with investing for $1 per share for FNM, later selling it for $100..... Why not ? Why not cherry picking time for the US Fed versus foreigners buying the scraps ?
I say GM and F are full of it. they want less restriction on the use of the funds because its too expensive for them to borrow at the private market. they want bigger loans to help their funding
Why not let them go under? It would deliver a knock-out blow to both Unions and Management that bankrupted Auto Makers. All that expertise will find new capital to resurrect a better managed Car Company with far less Union concessions.
The US could flip all the oil they bought in the SPR for a huge profit too...Maybe we should elect Steve Cohen as president and turn us into a HUGE hedge fund!!!1!
Todd Harrison at Minyanville has been writing about bailouts a fair bit lately. He's been saying that once they start, it's hard to stop. First it was Bear Stearns. Soon it will be FRE and FNM. Then it will be GM, F and Chrysler. Then the airlines. Then the homebuilders. Then some big regional banks like WM. How about the USA just writes a cheque for $10 billion and give it to every unprofitable publicly listed company, and get it over and done with? Or maybe, like Mish has written http://globaleconomicanalysis.blogspot.com/2008/08/ten-financial-entities-on-brink.html rather than these companies (apart from FRE and FNM) being too big to fail, the list of companies wanting bailouts is "too big to bail".