General Motors Is Headed For Bankruptcy -- Again

[Abii]

http://www.forbes.com/sites/louiswoo...kruptcy-again/

President Obama is proud of his bailout of General Motors. That’s good, because, if he wins a second term, he is probably going to have to bail GM out again. The company is once again losing market share, and it seems unable to develop products that are truly competitive in the U.S. market.

Right now, the federal government owns 500,000,000 shares of GM, or about 26% of the company. It would need to get about $53.00/share for these to break even on the bailout, but the stock closed at only $20.21/share on Tuesday. This left the government holding $10.1 billion worth of stock, and sitting on an unrealized loss of $16.4 billion.

Right now, the government’s GM stock is worth about 39% less than it was on November 17, 2010, when the company went public at $33.00/share. However, during the intervening time, the Dow Jones Industrial Average has risen by almost 20%, so GM shares have lost 49% of their value relative to the Dow.

It’s doubtful that the Obama administration would attempt to sell off the government’s massive position in GM while the stock price is falling. It would be too embarrassing politically. Accordingly, if GM shares continue to decline, it is likely that Obama would ride the stock down to zero.

GM is unlikely to hit the wall before the election, but, given current trends, the company could easily do so again before the end of a second Obama term.

You guys think it's possible?
It would certainly damage the US economy and add to the unemployment figures if this happens. Remember, it's not just GM, it's also the hundreds and thousands of smaller companies that supply GM. It's a chain reaction. If GM goes, so will thousands of other smaller companies.

 

[PERSIAN GOD KING]

who buys american cars for god sake?...
except Americans of course.

 

[Abii]

who buys american cars for god sake?...
except Americans of course.

Arabs like American cars too. All govt autos in arab countries are American. But yeah, without, the american people, these companies would die in an instant. East Asian and European companies have been stealing away mkt share in NA for decades now. The Americans keep producing the same ugly and cheap looking cars and I don't see how they can compete with EA and EU companies in the long-run.

 

[PERSIAN GOD KING]

Arabs like American cars too. All govt autos in arab countries are American. But yeah, without, the american people, these companies would die in an instant. East Asian and European companies have been stealing away mkt share in NA for decades now. The Americans keep producing the same ugly and cheap looking cars and I don't see how they can compete with EA and EU companies in the long-run.

Arab have no choice but to buy american products, gulf arabs in particular. American just make things big and think that makes it better.

 

[FaujHistorian]

GM should have been allowed to go bankrupt.

Obama admin has lost billions on socialist mumbo jumbo in alternative energy (Solandra) and saving Union jobs in places like GM.

This is what we call "Too Big to fail".

In reality if a corporation is inefficient, it should be allowed to die.

But Obama admin has refused to accept the reality and wasted billion of taxpayer dollars.


Sure there will be short term pain, but it will be good for Americans in the long run to let bad companies go to the grave yard.


In Pakistan too, we have inefficient state monopolies who are wasting billions of precious dollars. And here too, unions and leftist politicians are keeping the dead horses on life support and wasting Pakistanis hard earned money.


peace

 

[VCheng]

who buys american cars for god sake?...
except Americans of course.

Well, the Chinese have bought over 3 million Buicks, and sales are still strong:

Buick’s China Sales Surpass 3 Million Mark 12 Years After the Brand’s Debut - Carscoop

The best selling model in the Chinese car market is made by GM:

Buick Excelle tops China’s sales charts

Imagine that!

 

[kewell333]

GM should thank China.
This year GM sales in China will reach 3 million vehicles.

 

[Skull and Bones]

If they sell any subsidiary companies, maybe Indian companies will grab some this time.

 

[UnChosen]

Never mind what Obama did...we Canadians bailed out GM even more than the Americans considering the proportion of our economy/population. GM took our money and proceeded to close more plants in Canada after a year or so.

!@#$%^ them.

 

[Audio]

Imagine that!

It looks suspiciously similar to Opel Insignia and due to Opel being owned by GM it would not surprise me if the car would be designed in Germany.

 

[Killuminati]

Please i really hope that these whole economic system goes down. All the rich people that earned milions of dollars by poor workers will be go down to the same rank.

 

[Audio]

Please i really hope that these whole economic system goes down. All the rich people that earned milions of dollars by poor workers will be go down to the same rank.

Only a few....really rich have assets dispersed in such a way that practically everything valuable would have to loose value overnight for them to become poor.

 

[Abii]

Please i really hope that these whole economic system goes down. All the rich people that earned milions of dollars by poor workers will be go down to the same rank.

At the same time many will lose their livelyhoods. This is a double edged sword. If GM goes, HUNDREDS OF THOUSANDS will be jobless.

Ford needs to buy GM. Chrysler is pure diarrhea and GM is meh. There is only room for one American car company. They can produce all the trucks and muscle cars they want and there is a customer for those. The problem begins when they want to make cars for the rest of the people who demand some taste. I mean, an American's idea of a supercar is Corvette!!!!!! The car is made of plastic, literally! The inside of the car looks like a cheap third world car, and that's their super car.

 

[VCheng]

At the same time many will lose their livelyhoods. This is a double edged sword. If GM goes, HUNDREDS OF THOUSANDS will be jobless.

Ford needs to buy GM. Chrysler is pure diarrhea and GM is meh. There is only room for one American car company. They can produce all the trucks and muscle cars they want and there is a customer for those. The problem begins when they want to make cars for the rest of the people who demand some taste. I mean, an American's idea of a supercar is Corvette!!!!!! The car is made of plastic, literally! The inside of the car looks like a cheap third world car, and that's their super car.

Have you ever driven a Corvette?

 

[anarchy 99]

GM would already be in bankruptcy if it wasnt for china.
china is the largest market for GM.