GM Shareholders: Poof!

[BirdGuano]

Originally Posted by caonacl

The information is readily available in prior news articles.

Partisan opinion is available. Not evidence

...and BTW, I have no interest in defending the left wing. I don't understand why other so dogmatically defend the right wing, even when they are wrong/guilty.[/COLOR][/I][/B]

What part of BOTH do you not understand in my quote ?

BOTH parties are part and parcel to the current economic mess. Republican and Democrat. They BOTH buckled to a bankers coup without a hint
of resistance.

[rryan]

As I mentioned on another thread recently, this is the beginning of the end of private investment in the US and that will lead to a backlash the likes of which have never been seen before when the middle class realizes that they are in the crosshairs as well.

[leistb]

GM's shares lost $.29 or 20.14% to close at $1.15/share today...
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Holding GM Debt? Gubbermint Is Robbing You!

Do you hold GM bonds? Perhaps some so-called "unsubordinated" debt?
A lot of people - individuals - do.

These bonds were quite popular for college savings and other long-term plans - including retirement.

Why?

Because the coupon was pretty good, they were unsubordinated (meaning senior, or first) preference in the event of bankruptcy, and GM has been around for a very, very long time.

If you hold this debt you are about to be wiped out by our government, who has decreed by fiat, without even a vote in Congress, that:

1. You don't matter.
2. You don't have a right to rely on anything in the prospectus printed when these bonds issued, or even common and statutory law.
3. Your rights do not exist. Your government has literally declared economic war on you.

Let me be clear: The government, specifically President Obama's Treasury, is acting exactly as did George Bush's Treasury - they are behaving as gangsters who are about to rob you blind, returning only 10 cents - if that - on the dollar for your investment and they are going to force you to take it at gunpoint.

This despite the fact that the UAW is going to get somewhere between 80 cents and the full buck for every dollar they are owed for their VEBA.

VEBA obligations are unsecured and subordinate to yours under the law.

That means that under the law the UAW is entitled to exactly nothing until you get every dollar you are owed.

President Obama and Geithner have declared that it does not matter what the law says - they are going to do whatever the hell they want - and what they want to do is SCREW YOU.

They just got done ramrodding Chrysler bondholders with the exact same "deal", shoved down their throats, and allegedly enforced with threats of tax audits and other jackbooted actions if the bondholders resisted in court.

To be clear: You have every right, under the law, to receive full value for your bonds before anyone else gets paid for so much as one penny of the subordinated or unsecured debt owed to them, INCLUDING THE UAW.

You accepted a lower coupon in exchange for what was represented to be less risk as a consequence of this protection.

Now, after the fact, you are being robbed just as clearly as you would be if President Obama and Tim Geithner came into your house at 3:00 AM with automatic weapons and shoved them up your nose, stealing every penny you had.

I ask you this essential question:

If President Obama and Tim Geithner will steal from you in this fashion, literally at gunpoint, do you believe that your 401k or IRA will not similarly be confiscated whenever our government decides it wants to steal from you on similar "terms" - or when it suddenly "needs" some money (like when the bond market has had enough of this crap and stops being willing to finance a nearly $2 trillion annual deficit!)

Disclosure: No position in any GM-related instrument.

http://market-ticker.denninger.net/

[Potemkin]

Wait hold on here.

Stockholder put money into GM or bought their bonds.
The management team the stockholders and bondholders elected ran the company into the ground.
The government decided to pass bills authorizing bailout money if companies didn't want to go bankrupt.
The management team the stockholders and bondholders elected decided to take the money the government offered and screw over the stock and bond holders.

Sounds like the complaint is with the management of the company they elected.

Let me be clear: The government, specifically President Obama's Treasury, is acting exactly as did George Bush's Treasury - they are behaving as gangsters who are about to rob you blind, returning only 10 cents - if that - on the dollar for your investment and they are going to force you to take it at gunpoint.

Let me be clear: Your company was broke, insolvent, kaput.

At the point when the management decided to take money the company owed more than they had capital.

Your stocks were worth zip. People were only betting the management would take loot from the government.

If your company went to bankruptcy, the parts were sold off to pay off debt, you wouldn't have gotten anything.

Be happy you are getting 10%, looters.

[caonacl]

Did you see that GM may leave Detroit?

[Potemkin]

Originally Posted by caonacl

Did you see that GM may leave Detroit?

Personally I don't care.

Companies are there to make money for their shareholders.

If it is more economical to move the HQ to some other place to gain advantage or cost savings I say go for it.

[Lars]

I demand a bailout

[leistb]

GM Union Retirees Said to Cede Dental, Prescription Benefits

By Jeff Green and Katie Merx

May 13 (Bloomberg) -- General Motors Corp. union retirees will give up coverage of dentist visits and some prescription drugs such as Pfizer Inc.’s Viagra under a proposed United Auto Workers contract, people familiar with the talks said.

Those changes would match reductions that start as soon as July 1 for Chrysler LLC retirees, said the people, who asked not to be identified because the details aren’t public. Cuts in unemployment benefits and work-rule changes at GM also would mimic the Chrysler concessions, the people said.

GM, surviving on $15.4 billion in U.S. loans, needs to win ratification of a new contract before June 1 as one of the conditions to avoid a government-ordered bankruptcy. UAW local leaders were briefed on the plans today by Vice President Cal Rapson in Cleveland.

The proposed accord also eliminates retirees’ coverage of vision care and ulcer medications such as AstraZeneca Plc’s Nexium and includes higher co-pays for drugs and doctor visits, the people said. GM has about 522,000 union retirees and dependents and 62,000 active UAW members.
Only current workers vote on contracts.

Sherrie Childers-Arb, a GM spokeswoman, said the Detroit- based company hasn’t completed its UAW agreement and isn’t discussing details. Roger Kerson, a union spokesman, didn’t have an immediate comment.

Debt, Health Costs

Shrinking spending on retirees is among GM’s efforts to pare labor costs, debt and obligations to a union-run health- care fund known as a Voluntary Employee Beneficiary Association. GM and the union agreed to changes in work rules, bonuses and jobless benefits after UAW officials walked out of talks on the VEBA on Feb. 13.

GM has proposed that the UAW swap $20 billion in the automaker’s obligations to the VEBA for $10 billion in cash paid out over an unspecified period, as well as equity equal to 39 percent of a restructured company.

Like earlier agreements with Chrysler and Ford Motor Co., GM’s tentative UAW contract would reduce so-called supplemental unemployment benefit pay, which gives laid-off workers most of their take-home wages, the people said. The benefit would dwindle the longer a worker is off the job, based on seniority. The UAW first won the benefit in 1955.

Workers would agree to reduced classifications of so-called skilled trades such as electricians and pipefitters, give up bonus and cost-of-living increases, and cut some holiday and break time.

The coverage for erectile-dysfunction drugs, which also has included Eli Lilly & Co.’s Cialis and Bayer AG’s Levitra, would be restricted to retirees with previously diagnosed cases of pulmonary arterial hypertension, the UAW told members.

Prescriptions for ulcer drugs such as Takeda Pharmaceutical Co.’s Prevacid and other such antacids would be limited to prior cases of Barrett’s esophagitis and Zoellinger-Ellison syndrome, according to the union documents.

To contact the reporters on this story: Jeff Green in Southfield, Michigan, at jgreen16@bloomberg.net; Katie Merx in Southfield, Michigan, at kmerx@bloomberg.net.

Last Updated: May 13, 2009 14:34 EDT

http://www.bloomberg.com/apps/news?p...6dI&refer=home

[Ought Six]

c:

Sorry, but your posts are too ludicrous to merit any sort of serious response. Good luck with that BDS flareup.

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f:

"What you are witnessing is natural selection...."

Free market failures of companies is natural selection. The government fixing the value of a company's stock to near-zero; there is nothing whatsoever 'natural' in that.
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".... and creative destruction at work - thinning out the herd, making room for more new businesses, the lion killing the slowest Wilderbeast, you get my drift?"

The problem is that the predator in the market is the government. That is not, nor should it ever be, their role. Our government is supposed to govern, protect our shores, run a court system to resolve disputes and try criminals, and that is about it. This massive market intervention is an abomination, and will have disasterous results.
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"What you aren't hearing about O-6 is all the little companies that will be starting up out of the ruins."

With no credit, investment at a standstill and all the new taxes, regs and government interference in markets, that hope is certain to be dashed. America's economy is headed for at least a decade of malaise, unless current policies are reversed, and reversed soon.

[Ought Six]

Bondholders Stand Firm Against G.M. Debt Swap


By BILL VLASIC
The New York Times
May 23, 2009

DETROIT — General Motors, the struggling automaker, inched closer to a bankruptcy filing on Friday when the company’s largest bondholders reiterated they would reject an offer to convert their debt into G.M. stock.

The decision by the bondholders threatens to derail G.M.’s efforts to eliminate $27 billion in debt before a June 1 deadline set by the Obama administration.

G.M. has offered its bondholders 225 shares for each $1,000 worth of debt, which over all would give them a 10 percent stake in the company.

The company has said it needs 90 percent approval from its bondholders by next Tuesday if it is to avoid bankruptcy.

But the committee of G.M.’s biggest bondholders, which represent 20 percent of the overall debt, said there was no support for the current offer.

“It’s been a universal ‘no’ from the get-go,” a spokesman for the committee, Nevin Reilly, said. “Bondholders are being seen as speculative bad guys, but bondholders are investors, many of whom put their retirement money into G.M.”

Other, smaller investors have also protested the offer as unfair, increasing the likelihood that G.M. will fall well short of the 90 percent threshold.

There was no additional comment from G.M. The company’s chief executive, Fritz Henderson, has said it is unlikely that G.M. will increase the offer.

G.M., which is subsisting on $15.4 billion in government loans, has until June 1 to meet President Obama’s mandate for a broad restructuring that includes reducing its unsecured debt.

But bondholders have balked at the terms offered by G.M., saying that competing creditors, like the United Automobile Workers union, have received better treatment.

The U.A.W. said on Thursday that it had reached a tentative agreement with G.M. on how to finance obligations estimated at $20 billion for retiree health care.

The union’s president, Ron Gettelfinger, declined to divulge terms of the deal until its 61,000 G.M. members vote on it next week.

But people close to the deal said the union agreed to take a 39 percent stake in G.M. to finance half of a union-run trust set up to administer retiree health care.

Bondholders have criticized the terms as far more generous than what they have been offered thus far.

On Friday, the president of the Canadian Auto Workers said the union and General Motors Canada had agreed on a cost-cutting deal.

Under G.M.’s latest restructuring plan, the Treasury Department would get at least a 50 percent stake in the company in exchange for forgiving $10 billion of its outstanding loans.

G.M. has also pledged to cut another 21,000 jobs and four of its brands as part of its last-ditch effort to avoid bankruptcy.

But Mr. Henderson has said recently that bankruptcy is “probable” because of the difficulty of getting 90 percent of its bondholders to approve a debt-for-equity swap.

[penguinzee]

GM will be filing BK next Friday. Count on it...

Franc (penguinzee)