Jerry Flint, 04.21.10, 04:43 PM EDT
Forbes
Far be it for me to rain on anyone's parade, but don't be fooled: General Motors has not paid its debt back to taxpayers.
The company got $50 billion from our government, and $10 billion more from Canada. They have paid the U.S. back $7 billion plus interest, as I understand it, including the latest payment of nearly $5 billion. So they say they paid us back.
Not quite: That still leaves $43 billion.
GM can say they paid us back because of the $50 billion in total support, only $7 billion was counted as a loan and the rest was traded for equity in the company that emerged from bankruptcy. But that is really an accounting trick so that GM doesn't have to pay interest on that money.
What seems to have happened is that of the $50 billion given to GM, the company burned through some, and then paid back $7 billion from what they didn't spend.
We are supposed to get the remainder when GM sells stock.
Maybe we will, maybe we won't. If GM sold 1 billion shares at $25 each, that would be $25 billion, not enough to cover the whole debt. You never know, but I think the odds are against getting back all our money
Link to full article
Grandpa truly appreciates your article Mr. Flint! The financial news channels were simply too giddy yesterday to present the complete picture. Ed Whitacre should be sent to his room without dinner given his pep fest behavior yesterday and would someone please pull the plug on his commercials...enough already Ed! Yes Ed, you "still have more to do" like come up with another $43 billion plus interest!!
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