ECONOMICS | GM boosts IPO size to reduce government stake … So?!


Reuters just came out with a story entitled “GM boosts IPO size to
reduce government stake”.

The story gushes: “The revised terms of the IPO could make it the
largest stock offering ever in the U.S. market and could take U.S.
government ownership of the automaker down to as little as 33 percent
from 61 percent.”

They are expected to raise as much as $15.5-22.7 billion if people buy
high — always a sure bet.

My opinion as Bill4DogCatcher:

That’s nice. They owe you and me $50 billion.

So $50 billion minus $15.5 billion raised minus routine and recurring
expenses = yikes!

The Chinese bought 1% of GM on Monday for $500 million … please,
wait … am getting my calculator … oh, 100% of GM = $50 billion …
which is what they owe to us …. but we taxpayers only own 61% of GM.
That is a damn fine deal.

In fact! If the Chinese were to buy all of our 61% share we could get
$30,500,000,000 billion of our $50,000,000,000 back.

Hmmm … not sure I care. There is a Japanese and Korean car in my
driveway … and I ride a “Victory” bicycle made in China.

Why do we have an automotive industry again?

Read the Reuters story at http://www.reuters.com/article/idUSTRE6AB43H20101117

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