Cash Sink Hole GMAC Catches Last TLGP Train Out Of The Station With $2.9 Billion Free Issue

Tyler Durden's picture

With the FDIC-backed TLGP program set to expire on October 31 (with a 6 month safety net optionality, whatever that means), GMAC did all it could to jump on the last train leaving the cheap taxpayer funded capital station. The government subsidized provider of car loans for cars nobody wants priced $2.9 billion of 3 year notes. Luckily for the UAW and for the autobailout fans, the issue came in to price at a measly T-31.6 bps: a yield of 1.753% which would be unheard of had GMAC actually tried to tap the private markets. Oh yeah, and it is AAA rated. Thank you Sheila Bair for putting another $2.9 billion of taxpayer money in harms way and with a virtually 0% probability of recovery.

[PRICED:] USD2.9bn 1.75% 10/30/12. At 99.991, yld 1.753%. T+31.6 (MS-10). Settle 10/30 (T+2).

[GMAC Inc] Aaa/AAA/AAA in the market with USD2.9bn (will not grow) SEC registered global 3-year fixed rate TLGP trade via joint books Citi/DB/MS/RBS. Issued under TLGP, gtd by FDIC with full faith and credit of the United States. UOP: GCP.

Oh, and let's not forget that GMAC is an (undercaptialized) bank holding company. So next time you have a cool million lying around, why not deposit it with the best UAW-endorsed money manager around. What - no deposit branches... Hm, that can't be. Someone please get Sheila Bair on the line stat.

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SilverIsKing's picture

Virtually?  You are way too kind.

Anonymous's picture

Major plug on Bloomberg for Zerohedge!!!

ghostfaceinvestah's picture

I just saw that.  LMAO!!!

Cognitive Dissonance's picture

Marla mentioned today that ZH slapped on 40% more capacity. Just in time for the second wave of Yahoo message board refugees.

lizzy36's picture

( DJ ) 10/28 03:42PM *DJ California Announces $320M In Aid For Tesla Motors

how the f**k can california provide aid to any entity?

geopol's picture

The federal government uses the FED printing press

California uses IOU's


Hope that clears it up..for ya lizzy

Problem Is's picture

You should see the multi billion dollar plans "Broke Ass" Arnold has for a giant canal to ship millions of gallons of water to his golf course size Hollywood mansion lawns... on his way out the door.

Announcing the issuance of the new AAA rated "Broke Ass Arnold" California Bond...

I wish Arnold would learn from Palin and quit early...

Sancho Ponzi's picture

And for a car with a MSRP of $125k! 

faustian bargain's picture

i gotta get me one of those new sedans...

Anonymous's picture

maybe they should keep it and spend it on Bay Bridge Repairs!!!

Hondo's picture

How long can this keep up where government officials throw taxpayer monies at losing propositions to enhance the buddies without a complete takeover of the government by the sane.  This is even below third world government stuff...

geopol's picture

How long can they keep this up?? Until we run out of money..


On to the next project

ghostfaceinvestah's picture

We won't run out of money, we can always print more.

The correct answer is: until people stop accepting the money we are printing.

geopol's picture

You mean the government is printing not "we"

we= the people/sheep/401K Holders/ IRA holders /Pot holders whatever...

Little bit of a nitpick

ghostfaceinvestah's picture

The royal "we", you know.

If you or I printed money, we would be in jail.

When Bernanke does it, he is a hero.

Go figure.

geopol's picture

What do you mean printing money is illegal?? You mean after all these years I shouldn't have been......

I need to get hunched over and head for the tall grass.

Yankee's picture

Whoa, this is the oldest enterprise since 'they' invented government, aint to stop for a long time more - 'they' see the us like you should - go rent a modest altitude, say low teens airplane and fly all day anywhere on the coasts, atlanta, dallas, chicago, houston, denver, salt lake and on and on - baby there are houses and cars and mommas and school districts - you can see the roofs, the cars, the ambition.  They are not dry yet.

Anarchy doesn't work, gold doesn't work - speculate but don't think you'll trade a smidge of gold for your life when the goths and visagoths come for you, if that is what you prefer to an attempt at government.

Green Sharts's picture

Something tells me Sheila Bair had no say in the original TLGP program or in this decision to allow GMAC to tap it again.  

geopol's picture

Synopsis definition of program...leaves a little room..


12 CFR Part 370
RIN 3064–AD37
Temporary Liquidity Guarantee Program

AGENCY: Federal Deposit Insurance
Corporation (FDIC).
ACTION: Final rule.
SUMMARY: The FDIC is adopting a Final Rule to implement its Temporary Liquidity Guarantee Program. The Temporary Liquidity Guarantee Program, designed to avoid or mitigate adverse effects on economic conditions or financial stability, has two primary components: The Debt Guarantee Program, by which the FDIC will guarantee the payment of certain newly issued senior unsecured debt, and the
Transaction Account Guarantee Program, by which the FDIC will guarantee certain noninterest-bearing
transaction accounts.

DATES: Effective Date: The Final Rule
becomes effective on November 21,
2008, except that § 370.5(h)(2), (h)(3),
and (h)(4) are effective December 19,

desk-jockey's picture

10/29/09 - You'll Nevar Forget


OMFG as i live n breathe i never thought I'd see this country turn into THIS huge of a pile of SHIAT.  I don't have enough curse words with aberrant spellings to quantify my f*cking IRE.  BURN BIATCH BURN.



/still not convinced this isnt the mother of all leg-snares up in here...guess we'll find out tomorrow, but holy shiat the FAZ is FLYING.  So is the QID.  The only two green things on my board.....


whiskey tango foxtrot.

jm's picture

Cash Sink Hole?

Cash Shit Hole.

ghostfaceinvestah's picture

The bigger question I have is, why are these guys still allowed to run a mortgage origination and servicing shop?  How does that fulfill their supposed mission as a captive auto finance company?  Do we really need another mortgage broker for the govt?

Chumly's picture

GMAC AAA Rated ; )

Stuart's picture

Enough!  Let these bastards collapse.

Dixie Normous's picture

So when GMAC was offering to settle home equity loans and lines of credit fo 5 to 10 cents on the dollar, were they doing it so they could be eligable for more gov cheese.

Joe Saluzzi kicking ass on Bloomberg just plugged Zero Hedge.

Oxytan's picture

Congratualtions Zerohedge.  Joe Saluzzi was on Bloomberg moments ago and just gave you a nice mention.  He made good points too!

Takingbets's picture

The best part of Joe's comment was when he said Zero Hedge tells the truth unlike the Government. Thank you Joe, maybe we can get more eyes open to what is really happening to our Country!!!

Uomo senza nome's picture

Ugh! At school right now. can someone post the link so I can watch it later?

Cocktosen's picture

Cool. They're mentioning ZH at Bloomberg TV for a few sec just now...

Takingbets's picture

Get ready for a spike in traffic this site just got some big props on Bloomberg from our friend Joe. :)

desk-jockey's picture

can we have a group hug before the unwashed masses show up?  Just wanted to say I f*ckin' LOVE this place, man. (sniffle).


/srsly, I do.  I almost remember the day we met, all those months ago, in that little cafe on Blogspot Street.  It was love at first sight.  Peeps of ZH, RAWK ON.

deadhead's picture

I have news for everybody. I like JS, smart, reasonable guy, but....

ZH is much, much bigger than JS.

geopol's picture

Congratulations ZH  and staff, and to all the contributors who make this place very interesting, and great to be a part of...

squidward's picture

So Taxpayer money goes to GMAC and their Alley Bank with the highest interest rates in the country.  These subsidized rates are stealing deposits from REAL community banks that actually lend money responsibly.   F*** GMAC, Cerberus, Geitner and his B.S. stress tests, and the horses they rode in on.

ghostfaceinvestah's picture

Yeah, haven't we seen that game before?

WaMu, IndyMac, etc., etc.  Too bad those guys weren't funded by the taxpayer, we might still be able to get Option ARMs.

Green Sharts's picture

You can't have everything.  But if you are a first time homebuyer, you can buy a house for up to about $228,000 with no money down using a combination of a 96.5% FHA loan and the $8000 first time homebuyer tax credit.

Act now, this offer expires November 30!  No wait, April 30, 2010!

deadhead's picture

GMAC and their Alley Bank

a magnificent typo!

buzzsaw99's picture

GMAC, shit loans for shit cars for shit buyers. I hope the UAW loses all their pension money in the corporate bond and scam market.

Sqworl's picture

Bloomberg broke the don't talk about ZH...period.

SDRII's picture

Cnbc with breaking news that wall street strateguist are in agreement this is a mild correction and that spx will be higher by year end. Unreal that something like this makes news? wall st bullish who could have known? Paging Brian Roberts -- Do you have a conscience?

deadhead's picture

and cramer said today that the highs for the year might be in.

go figure. that's why i don't watch cnbc, but do read their website.

SDRII's picture

cockroaches scrambling

Zro's picture

Oh, and let's not forget that GMAC is an (undercaptialized) bank holding company.

According to the Ally Bank website:

You may be asking...
Is my money safe with Ally?

Yes it is. We're one of the [best capitalized banks] in the country. And all Ally accounts are covered by the FDIC up to $250,000 per depositor.

[best capitalized banks]:

As a new bank, our Tier 1 capitalization leverage ratio is almost triple what is deemed "well capitalized" under the FDIC's regulations.

Brett in Manhattan's picture

With the way these numbers get thrown around, it's easy to become inured. So, let's put $2.9 billion in perspective:

The New York Yankees are worth approx. $1.5 billion.

Anonymous's picture

The BEST way, perhaps, the ONLY way to protest the bailouts, is don't funnel your own money their way. While we clearly can't control the collective tax payer money run by corrupt politicians.

Don't get financing from C, AIG, GMAC etc.

Don't buy a GM car. Don't buy a US car with UAW support.


It's a darn shame it's come to that, but...go John Gault.


max2205's picture

They get to loan out at what, 10 to one or 100 to one.... 29 billion or 290 B of additional bad loans to prop up the "ecomomy