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GMAC Q4 Loss Comes In At $5 Billion A Week After Taxpayers "Acquire" The Defunct Company
Well at least US taxpayers, who are now proud majority owners of GMAC aren't blowing their money, $3.8 billion most recently to be exact, for nothing. Oh wait, they are. But at least Obama still has the union vote: GM December sales came in at -13% YoY and GMAC still lost $5 billion in Q4. But don't worry, the bottomless hole will return all this and much more for taxpayers. After all, Obama said so. In the meantime, everyone clean out your pockets: several tens of billions of more GMAC losses coming our way until GM finally gives away enough cars for free to have its VPs beaming on CNBC about what great a prospect giving cars away for free is, courtesy of endless taxpayer financing. In other news, nobody gives a rat's ass: after all China and the Primary Dealers will buy the one eighth of the next 5 year auction needed to finance this loss at 2.6%. And all shall be well.
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Last time I checked, Huffington Post's breaking news items was that there's still a chance that we can still resolve the housing crisis...
Yeah... uh, no.
Looks good -- where can I buy shares? :-/
You already did, being held in trust by the Fed. Feels good don't it.
On another note, your (and everyone elses) purchase of GMAC shares was announced on ... 24th December 2008: see a pattern?
We don't have one big black hole. We have dozens, hundreds, of small and medium size black holes, all circling the central bank, waiting for the right moment to merge and swallow America (and anyone else on this Earth) whole.
We don't need CERN's Large Hadron Collider to conduct ground breaking experiments around the edges of the known universe. We have the Federal Reserve working 24/7/365 on that little project.
http://en.wikipedia.org/wiki/Large_Hadron_Collider
Yeah, um, before this happens, let's all remember that debt is a state of mind. It's a paper thing, a fiction. A promise.
Not the same as an actual black hole on a collision course with the earth at a few astronomical units. Life will go on if the freakin bondholders (aka rich) don't get paid.
The rich don't pay fuckin taxes, they lend to the gov't at interest. Time to de-jew them and make them into equity holders instead of usury lenders.
Most of those bond holders are money market funds, i.e. you and me.
"de-jew" = not cool. Otherwise, all good.
EDIT:
Anon #183398,
"de-jew" = not cool. Otherwise, all good.
disgusting , racist swine
trav 777 . . . . . . racist
That was so nicely said.....
Kinda hard to call making 0.00000% on at T-Bill usury.
Banned.
Thank you Marla. Many of us have, at one point or another, stepped over the line. But Trav777 was making a career out of it. A troll of the most vile kind.
thank you, marla.
cd, your "get over yourself" post to you-know-who last week was priceless and highly warranted. i mean, the guy feignly compliments your intelligence and then makes a point to demonstrate his perceived intellectual superiority by pointing out a typo... in the very same sentence. what a tool. lol
The best thing GM can do now is to get out of the car making business completely
and retool to do nothing but make parts for the 200+
million cars they've already poisoned the earth with.
With peak oil beginning to rear its ugly head on the
world, car building will become an extinct practice in the
near term.
Money well spent.
Solid B+.
Spent better than the bailouts of the investment banks for certain.
I for one do not cherish the day when we will only be blessed with a post industrial - 100% service sector - based economy... (although it saves quite a bit not having to educate scientists and engineers and the useless like...)
In the meantime however... if the dollar collapses the industry bailouts may appear totally justified if not prophetic... or you can just turn the lights off on American industry now...
Just sayin'...
While technically true perhaps, it's far better none of it was spent at all. No?
Look, I'm certainly sympathetic to your argument here. But we in this country have decided that making stuff is, well, icky. It's noisy, it pollutes, it gets people hurt, yadda yadda yadda. So we've made the conscious decision, over the course of decades, that we just assume people somewhere else - somewhere like... China - make all our stuff for us and we'll try to build an entire culture around the productivity of moving paper around and suing eachother.
I don't agree with it, I don't like it, but there it is.
We deserve the absolute hammering we have coming to us, in other words.
Well said!
It will be a very well deserved hammering at that docj...
Still I find myself rather perplexed at the current state of affairs... couldn't the not-so-big 3 have just forked over $300MM of the industry bailout to the congressional whores like the banking and healthcare sectors did... to have them write a bill making it an indictable offence to drive or own a foreign made vehicle?
Where has American engenuity gone these days?
Good point... except what is 'foreign-made' anymore... many 'foreign-made' cars are made right in the USA... BMW... Honda... Nissan... Mercedes... Toyota... Hyundai... and right now they are picking over the corpse of GM and Chrysler.
Also a good point, my cousin built my Mitsubishi in my state. How is that not good for my family? 0% interest loan, 100k warranty. I have owned GM, Ford junk and no more. My Grandfather even sold his dealerships tired of the junk.
Domestically "assembled" foreign made should be OK if domestic content is still in the final product... but hey... I'm not the guy writing the bill.
Has anyone ever seen how other nations "protect" their industries lately? I have... just sayin'...
Very true... it will likely be the decade of protectionism... and how to do it in a good way... if that is even possible... will be the challenge.
dietech dot com. Can we see a CEO get fired?
Absentee taxpayers.
Remember when cars used to be a product instead of a monthly fixed income investment vehicle for the car companies!!! Remember those days? Oh ya you weren't alive in those days.
And all shall be well.
Right on.
Fuck you people. I, for one, am DAMN PROUD to be an American and to be having my national investments put to such good use.
I mean, they only lost $5B. Private companies lose way more than that all the time. They lost less money than most of the banks and a lot of other companies. This is one of the better performances out there.
I only hope that they can run my health care and everything else with the same efficiency and proficiency that they've run GMAC and FNM/FRE.
I mean Howie Long is telling me the Malibu beats the shit out of Camry and Accord...wtf more do you people need to get patriotic?? It's a sad day in this great nation when the people won't get behind a massive government boondoggle with jingoistic fervor. Baby Jesus is weeping
You forgot </sarcasm>
Felt no need to state the (glaringly) obvious
You only feel that way because you're not running Ford.
Shake and Bake! That went over most heads on this sight.
Agreed... most on this site are as phony as a three dollar bill. Don't post hrere if you want an American view.
The Greatest Generation was born with less, not more. They built things and constructed the fabric of American Society. They died in a wars. There's still hope that we'll have those opportunities to bring back the old normal. Anyone want that? Anyone wanna play? Anyone.....Bueller? (thanks Marla)
Exactly! Look at the whole of recorded history. The last century was an anomaly and we are about to regress towards the mean in a painful way, well 99% of us anyway.
+1000.
Unfortunately the sheeple desire a consumption, not production, based economy. Production is too much like real work.
greatest generation blablabla
They were nothing special
All the previous generations built things too...no income tax, no Fed, no massive central government, no Military Industrial Complex.
There were "depressions" and bank panics before. But the greatest generation wasn't even born by the time their ancestors had built us into the richest nation on earth and the unions had carved out wage concessions to distribute the wealth.
The Greatest Gen fought the war, sure...anybody prior would have. But they came home to a social structure built by their parents and grandparents.
Whoever flagged my post as junk...fuck you.
Yes I will piss on your holy institutions like the one that the "Greatest" generation was the freakin greatest generation.
GFD, who raised the godawful baby boomers to be such petulant snots?
The generations before were greater...they gave us the industrial might, the unions, the child labor laws, and all of it. After the War, everyone went on cruise control.
lowlife
the work ethic, has been seriously undermined, in this culture. that's one of the first things, that will have to be rebuilt. work harder, work smarter, earn more. no more paychecks, for showing up.
i wasn't talking about the baby boomers, i was talking about their parents and grandparents who managed to survive without the perverted institutions, i was talking about character.
we went on cruise control because we didn't have to fight or compete anymore, all our competitors were destroyed and they needed us to rebuild, not a bad position to be in, but the kind of environment that can create godawful petulant snots.
how many people today would trade "entitled privilege" for sacrifice for the benefit of all, including future generations?
Funniest shit ever!
Hey ZH! Don't knock Bob Pisani like that. I think its wonderful that CNBC is willing to hire people with intellectual disabilities. Really it is an inspiration that he has overcome so much and after so much work can now repeat word for word what the producers are chirping in his ear. Yeah sure he twists every bit of news into an excuse to buy stocks, but again its a massive improvement from when he used to smear his feces all over Sue Herera. So YOU GO BOB...I know you are still working on your reading skills (how else can one cheerlead so hard?) and won't read this, but I'm pullin for you buddy.
PS: Any takers willing to guess when Tokyo is gonna step in and help Toyota finance cars internationally (ie here in the US)? I can't imagine they'll sit back for much longer now that we're subsidizing financing for domestic vehicles.
Clearly, this GMAC news is a victory for the bulls.
After the Yen goes supernova (250+/dollar?) later in 2010, Toyota will have no trouble selling cars to the US or China. Yes, I can see it now and can hardly wait. The new 2011 Camry going for less than $10,000.
Doesn't bode well for GM or GMAC though.
Steak-
Wife works for Toyota Financial. Dec of 08 they had to borrow 2 bil from Japan because no bank here would lend. Now USG finances their competitor. TFS makes money, doesn't need Gubbmint subsidy.
Remember the people we used to call "The Masters of The Universe?" Maybe now we should call them "The Dukes of [Moral] Hazard."
just as long as Sheila Bair doesn't don the Daisy Dukes.
Serves me right to make a silly joke. Now I'm gonna have scary dreams. Thanks tons. ;)
not cool, fb. now i'm gonna have to start drinking earlier than normal to flush that visual outta my head. lol
The difference is that Toyota make good cars that people want to buy and are liable to be around and service the fuckers in three years.
Yeah, you better be a good mechanic if you buy a Chrysler, the Italians will be cutting and running by 2011 I'd bet.
most toyotas will go 3 years, needing only oil changes
Where does Ford play into all of this? They were on the ropes back when GM started sucking the Federal teat. I saw some aggressive talk of quickened debt repayment by Ford in some investor news, but the amount of rebates they were throwing at their cars and trucks at the end of this year was redonkulous. I can't imagine they are in any better shape really.
Not that it matters of course as Ford knows very well Bush III will be there with the tax payer dole.
The Fed subsidy of GM/GMAC will BK Ford. They cannot compete with an automaker that can sell at a loss.
they've been doing it for years
Enjoy the GMAC bowl game folks, it cost you a metric shitload.
You do wonder why a captive finance company has to pay big bucks for advertising.
http://www.gmacbowl.com/?PageID=1036
GM sales down 5.7% y-o-y
Chrysler sales down 3.7% y-o-y
As for non-Government owned motors:
Ford - up 33%
Toyota - up 32%
Honda - up 24%
you get the picture. It looks like people are really taking to heart the message to NOT support these bailed out companies.
Keep it up.
I think that has to do more with the concept of moral hazard than the sheeple actually knowing the difference between those companies.
GM/Chrysler has been selling junk for decades now.
Nothing symbolizes the stupidity and phoniness of the current stock market rise and economic "recovery" than the continuing saga of "Motors Liquidation Company", i.e., the former GM.
Today (Jan. 5, 2010), a "company" that is known by all to have a common share value worth zero dollars and with no possibility of future growth (since it isn't really a company) rose 8.45% (!!) to 0.565 per share on news that December car sales were strong.
This might have made sense under some twisted logic if GM (the future GM) had posted good sales numbers, but according to ghostfaceinvestah GM's sales are actually going down. But of course there's no connection between the future GM and MTLQQ anyway so car sales shouldn't have had any impact on MTLQQ's stock price.
The whole situation is a great example of how stock prices are not directly connected to a company's worth and are in fact completely arbitrary. Could shares of MTLQQ continue to trade even after MTLQQ disappears from existence? Why not? (The only thing preventing it is some silly rules about stocks having to be associated with actual companies.)
Stupid "Like A Rock" - Amerikans perfection of hubris.
Obama = Herbert Hoover
I want your love love love.
http://www.youtube.com/watch?v=nsCXZczTQXo
:D
-MobBarley
How long can the games, fraud and money printing really go on for......I get the strange feeling we're sitting on a nuclear device set to go off and the timer is ticking.
You know, I'm of this school of thought too. Then I recalled this line from MIB...
There's always an Arquillian Battle Cruiser, or a Corillian Death Ray, or an intergalactic plague that is about to wipe out all life on this miserable little planet, and the only way these people can get on with their happy lives is that they Do... Not... Know about it!
Don't know if it's relevant, but it does make me think that perhaps we've actually been down this road before, only now it's happening in living internet. Don't know.
and yet the preferreds are up 4%? GOM up 3.88%, GMA up 4.11%, GKM up 3.32%, GJM up 2.90%
nice returns... you still forgot to mention MLTQQ.PK, up a nice 8.5% today. I put a lot of money at work in GM and expect a year end price of over 2$ (or a 400% return from the 0.56 now)
How ? Obama and his administration will speak infinite bailout money for GM I guess very soon (as for freddie and fannie). I really dont care that others will pay for that and I even care less that they sell no cars, I want to see my GM shares go to 2$ and they will.
Reminds me of Spongetech(you know, the ShamWow guy)
???????
please only serious comments ! Thank you.
Once new shares of GM are issued the MLTQQ is worthless according to
http://www.motorsliquidationdocket.com/
MTLQQ is worthless even now, as it represents the common shares in a defunct company. (Technically, each share of MTLQQ is worth about $0.01-$0.02; holders of common shares are the last in line when the carcass of a dead company is divied up).
I can only assume xamax was being dryly sarcastic. For god's sake, kids, don't buy shares of MTLQQ! It is not GM. It's called "Motors Liquidation Company" for a reason. It's just an artificial entity created to supervise the bankruptcy of GM.
Read all about it at http://www.nytimes.com/2009/07/11/business/11primer.html. In particular:
Apoligize, I was on purpose sarcastic ! So when they say GMAC is now 56% held by government, it is another lie, it's clearly 100%. But the most pathetic side of this story is that they destroy on the same time F and the European /Japanese carmakers who don't (yet) receive bailout money .
If MLTT.PK is worthless, what then about FRE and FNM, still trading both over 1$ ? There are things I simply don't understand anymore though being in the finance business for over 20 years.
How did GM last this long that is the question?
Bad management
Bad Unions
Bad products (not all lines but most)
Late on fuel efficent models and hybrids
Late on smaller cars and luxury brand allowing many competitors in
Someone please put it out of it's misery.
Anyone notice/see James Lockhart (former OHFEO) chief on CNBC today? Basically said HAMP and HARP will not work and it is time to start reducing the principal on ALL underwater mortgages to avoid the growing threat of strategic defaults. He also said that the taxpayers will not be paid back for the money given to the agencies (no surprise). GMAC sucks but these GSE will cast us taxpayers approximately 3-400 bb.
Surprised you guys at Zerohedge did not pick up on the story. Lockhart is a no bs guy. Also, I wish some reporter somewhere would ask the head of GNMA why they continue to makre 97% ltv loans when they are shorting the strategic default risk with just a 10% decline in home prices.
Guess I am just a pissed off taxpayer.
'
Barney Frank was also on CNBC today saying the unlimited bailout of Fannie and Freddie was not meant for principal writedowns, and not to expect principal writedowns as that would take a congressional act (not sure that is accurate, but whatever), so it ain't gonna happen.
"Frank also brushed aside suggestions that Congress could soon pass legislation that would reduce mortgage principal for struggling homeowners. Such a program would violate contractual agreements between lenders and borrowers, Frank argued, and could only work if homeowners went into bankruptcy."
http://www.huffingtonpost.com/2010/01/05/barney-frank-fannie-fredd_n_411...
They can do whatever they want to any loan guaranteed by the GSE's. They will claim it is a loss mitigation strategy. They can not mandate it for non-gse loans but they can certainly pressure banks.
Why would the GSEs do it? Less than 4% of their non-insured mortgages are delinquent. Even if all those went to foreclosure, that is hardly a tragedy.
The bulk of their delinquencies are on loans with mortgage insurance. Over 10% of those loans are delinquent. Why would the GSEs forgive principal if they have insurance coverage on the top layer of the loan? i.e. if a 200,000 loan has the top 50,000 of loss insured, why would the GSE forgive 40,000 in principal? So they bailout the private mortgage insurers by letting them off the hook for their claims? What do the GSEs gain by that? Nothing.
Plus, what about the loans with second liens? So the first lienholder will forgive principal and bail out the second lien holder?
This is what 99% of the commentors on the GSEs don't understand, including some prominent bloggers. They see the government back the GSEs, then think it means principal forgiveness. That move was all about the reassuring the debt markets, not bailing out the plebes.
Because at the end of the day it is the only solution that may work. Yes, the move at year end was to reassure bond/mbs holders but losses are mounting and as Lockhart said in the video, strategic defaults are on the rise due to underwater mtgs.
If the GSE were solvent/independent, they would never allow it. However, they are owned by the govt and when/if those 10+ percent and growing loans are foreclosed, the MI's will be bankrupt. Just saying that for better or worse, principal forgiveness will become the main policy tool to keep underwater borrowers in their home - regardless of moral hazard