GM CEO says government loans have been repaid

DETROIT — General Motors Co.'s CEO said Tuesday that the automaker has repaid the $8.1 billion in loans it received from the U.S. and Canadian governments, a sign that a plan to rebuild the company is working. GM got a total of $52 billion from the U.S. government and $9.5 billion from the Canadian and Ontario governments as it went through bankruptcy protection last year. The U.S. considered as a loan $6.7 billion of the aid, while the Canadian governments held $1.4 billion in loans. The loan payback to the U.S. government comes five years ahead of schedule, and Whitacre said it is a sign GM is on its way toward reducing government ownership of the company.

”GM got a total of $52 billion from the U.S. government” “The U.S. considered as a loan $6.7 billion of the aid.” So GM paid back the INTEREST. What about the 52 billion PRINCIPAL ????

AUGUST 2009 Taxpayers Face Heavy Losses on Auto Bailout. A Congressional Oversight Panel recommends the Treasury Dept perform a legal analysis for providing TARP funds to (1) GM, (2) Chrysler Motors, (3) GMAC, their financing arm.

BIGGER QUESTION---WHERE IS THE MONEY? Americans have yet to learn the full extent of official corruption, thievery, schemes and scams involving $TRILLIONS of tax dollars aided and abetted by the dupes on Capitol Hill.

THE WHIFF OF MADOFF J, Ezra Merkin---ousted head of GMAC (GenMotors financing arm)---got a $6 Billion taxpayer bailout---and was also feeding hundreds of millions to jailed money launderer Bernie Madoff from Merkin's four offshore investment vehicles.

BAILOUT SWILLERS Stephen A. Fineberg's private equity firm---Cerberus Capital Management LP--- owns Chrysler Motors. The US Treasury bought a $5 billion stake in GMAC (GM's financing arm), and lent $1 billion to GM. This latest loan is IN ADDITION to the $13.4 billion the US Treasury lent earlier to Merkin's GMAC, and Fineberg's Chrysler.

SWILLING TIMELINE In 2006, GM sold 51% of Merkin's GMAC to Feinberg's private equity firm Cerberus Capital Management LP (which also owns Chrysler).

HOGGING AT THE PUBLIC TROUGH In May 2004, Feinberg's "private investment group," Cerberus Capital Management, LP became majority owner of IAP Worldwide Services, Inc, one of the US Army’s largest contractors in Iraq. In Afghanistan, Feinberg's IAP runs a drug/addiction center" in Kunduz---Kunduz is the largest opium supplier in the world. BUSY LITTLE BEAVER IAP also provides infrastructure support for the British Ministry of Defence in Kandahar....apart from supporting the US Army in Basra.

BAILED OUT AND STILL SWILLING Stephen A. Feinberg's IAP also serves a broad array of federal clients including the US DOD, NASA, the US Geological Survey, the US Agency for International Development, the IRS, and a variety of other federal agencies.

BACKSTORY GMAC's Merkin and Chrysler's Feinberg paid the Israeli govt $500M to buy Bank Leumi. An “inside” deal not just anybody could get. Bank Leumi looms large in the missing billion dollar bailouts since Israel is the only place in the world where an individual can fly-in, go to a bank with a suitcase full of cash, and nobody asks where they got it, or whether taxes were paid on it.

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REFERENCE Treasury Dept officials have acknowledged that most of the $23 billion provided by the Bush administration is likely to be lost.

Bush should have refused to do it (there was $15B fund already appropriated and committed but unspent - for "greening" of the auto industry - that should have been used) and could help convince the management of both companies to file for prepackaged bankruptcy, which would allow both companies (and maybe Ford, as well) to restructure their debts and union and pension contracts, reorganize and emerge far stronger, without taxpayers losing a dime. Now he is (rightly) being blamed by media and Democrats, who at the time demanded the auto companies bailout, for wasting taxpayers money.............

The report also recommends the department perform a legal analysis of its decision to provide TARP funds to GM and Chrysler, their financing arms and many auto parts suppliers. Some critics say the law creating TARP didn't allow for such funding.

DID YOU KNOW? TARP was not designed to be a pool of money available for bailout of just anything that didn't move, like a couple of bankrupt unionized companies in the automobile industry. It was very specific in its purpose to provide liquidity to frozen banking and financial system and stave off the run on the banks (attack on the financial system, by proxy) and allow the 'netting' of the [frozen] assets on the books of financial institutions, in the aftermath of fall of Lehman Bros and run on trillions of dollars in the money market funds in the consequent "breaking the buck" by Reserve Primary Fund managed by Bruce Bent.

con't

Speaking of bailouts and government control of business...

McCain seems to be a holdout for Obama in his new Senate Bill 3217, also known as the Restoring American Financial Stability Act of 2010, introduced by Democrat Senator Chris Dodd of Connecticut.

More info on that from the Tea Party.

The vast majority of Tea Party Patriots’ Local Coordinators from all over the country agreed on our most recent weekly conference call that this is a bad bill and we oppose it.

In short it grants permanent, unlimited bailout authority to the Federal Reserve. It’s like TARP forever without the nasty, unpopular debates and votes in Congress. Beyond that it gives the Fed the power to takeover vaguely defined “nonbank financial companies”. And the Fed has the power to decide what constitutes a “nonbank financial company” on a case by case basis.

So, what are we asking you to do?

Four things:

1.) Please contact your own Senators first and voice your opposition to this bill. If possible, physically go in person to the local home offices of your two Senators and speak to someone there who will take note of your opinion and pass it on. If you’re not able to go in person, please call, email, and fax the offices of both Senators from your state. (Find Your Senators by State on the Senate Website)

2.) Call, email, and fax these 8 Republican Senators who are not yet 100% opposed to this bill:

Bob Bennett of Utah (202) 224-5444
http://bennett.senate.gov/public/

Susan Collins of Maine (202) 224-2523
http://collins.senate.gov/public/

Christopher Bond of Missouri (202) 224-5721
http://bond.senate.gov/public/

Saxby Chambliss of Georgia (202) 224-3521
http://chambliss.senate.gov/public/index.cfm

Bob Corker of Tennessee (202) 224-3344
http://corker.senate.gov/public/

John McCain of Arizona (202) 224-2235
http://mccain.senate.gov/public/

Olympia Snowe of Maine (202) 224-5344
http://snowe.senate.gov/public/

Scott Brown of Massachusetts (202) 224-4543
http://scottbrown.senate.gov/public/

3.) Write Letters about this issue to your local paper for publication on or before Sunday. Also leave comments on as many news blogs and websites related to this subject as you can find.

4.) Forward this message to as many people as you can and ask them to take these same 4 steps as soon as possible. Use the full power of your circle of influence to move others (at least 1 more person) to take action.

Once again it’s up to us, you and your fellow Tea Party Patriots, to defend America from out of control government.

tppatriotssupport@gmail.com

con't

Ezra Merkin Relationships Map (interactive at web site) NOTE: Daphne is Merkin's sister.

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THE MERKIN STORY J. Ezra Merkin lives in a posh duplex at 740 Park Ave, Manhattan, known as the richest address in NYC. Merkin is the son of the late Hermann Merkin, a lion of Jewish philanthropy who gave millions to help build Yeshiva University, the Fifth Avenue Synagogue, and NYC's Merkin Concert Hall. Merkin's father was a director of the Israel Discount Bank of New York......the bank US investigators investigated for money laundering fraud.

MERKIN BIO Jacob Ezra Merkin (born 1954) is an American money manager, financier, and philanthropist. He served as the Non-executive Chairman of GMAC until his resignation on January 9, 2009, at the insistence of the U.S. government.

He is the general partner of Gabriel Capital LP, a $5 billion family of hedge funds.

On April 6, 2009, Mr. Merkin was charged with civil fraud by the State of New York, for "secretly steering $2.4 billion in client money into Bernard Madoff's Ponzi fraud without their permission."

Merkin is the son of Hermann Merkin, a prominent banker, philanthropist, and author, and Ursula Merkin. He is the brother or Daphne Merkin, a writer. He is married, and the father of four children.

Merkin attended Ramaz, an Upper East Side Modern Orthodox prep school, two yeshivas in Israel, then Columbia University and Harvard Law School.

He briefly worked for the law firm Milbank Tweed. But in the early 1980s he moved on to Wall Street finance, his father’s business, working at a hedge fund run by Alan Slifka, his father's friend.

There he met Joel Greenblatt, who founded Gotham Capital in 1985, where Merkin worked as an analyst until 1988. “It’s very, very difficult for Ezra to make decisions. He worried about the big picture, fretted over allocations. His gift was that he was a world-class salesman. He recognized that many people didn’t have (investment decision) confidence, that if people had confidence in him, then he could give them confidence,” said one money manager who worked with him over the years.

In 1995, he paid $11 million for an apartment at 740 Park Avenue, an 18-room duplex formerly owned by Ron Perelman, a member of his synagogue. In 2003, he began to collect 12 Mark Rothko paintings, the largest private collection in the world, worth an estimated $150 million.

In 1988, Merkin started Gabriel Capital to raise capital, and funnel it to managers in exchange for a fee.

By 1992, Merkin was raising money and co-managing securities with and for Stephen A. Feinberg, a manager whose private-equity firm Cerberus Capital Management, later bought controlling shares in Chrysler (80%) and GMAC (51%, at a cost of $ 6.4 billion), the financing arm of General Motors.

Merkin invested his funds into Cerberus and its portfolio companies. His Gabriel fund invested $79 million in Chrysler, $66 million in GMAC, and $67 million in Cerberus partnerships, according to year-end statements. On March 30, 2009, it was announced that Cerberus would lose its controlling stake in Chrysler.

Merkin manages Ascot Partners LP, a hedge fund which was valued at $1.8 billion prior to the collapse of Bernard L. Madoff Investment Securities LLC.

Most of GM / UAW government "loans" were converted into "equity". You "own" it folks, whether you like it or not...

General Motors (GM) makes a wide portfolio of cars and trucks, with brands such as Buick, Cadillac, Chevrolet, and GMC. GM also produces cars through its GM Daewoo, Opel, Vauxhall, and Holden units. Financing and insurance business is primarily conducted by GMAC (GM currently owns about 10%). The century-old GM is experiencing historic financial challenges that threaten the company's longevity. The company received billions of dollars in loans from the Canadian and US governments as it restructured, negotiating concessions with its labor unions and jettisoning brands. The giant automotive manufacturer went through a brief Chapter 11 bankruptcy reorganization in 2009.
GM's bankruptcy reorganization was completed in 40 days. The company sold most of its global assets to a "New GM" entity to create a carmaker less burdened by debt and high costs for labor and retiree care. With the cooperation of the Canadian and US governments, its North American unions, and its unsecured bondholders, the "New GM" emerged from Chapter 11 with about $17 billion in debt, $8 billion of which is owed to government lenders. Other government loans were turned into equity in the new company, giving the US government about a 61% stake in GM; the Canadian federal government and the Ontario provincial government together hold another 12%. The remainder is held by a UAW retiree health care trust, and by unsecured bondholders and unsecured creditors. The US government foresees a possible IPO for the restructured company in 2010.
Among other measures, GM will focus on its Buick, Cadillac, Chevrolet, Opel, and GMC brands, while discontinuing the HUMMER, Pontiac, and Saturn brands. The automaker plans to reduce its number of US dealerships by about 40%, closing more than 1,600 by the end of 2010. Its goals are to build up its financial strength (and pay back the government loans) and to improve the quality of its cars and trucks. Looking to the future, GM is working to develop energy-saving technologies using biofuels, fuel cells, hybrid vehicles, and extended-range electric vehicles, as well as develop batteries for its vehicles.
The company was making 100 Chevrolet Volts in 2009 for test purposes. If all goes as planned, GM will produce 10,000 of the hybrids in 2010 and 60,000 in 2012. GM also announced a partnership with Segway to develop a two-wheeled, two-seat electric vehicle.
GM is restructuring its Opel/Vauxhall brands, citing improved business conditions and the importance of the Opel and Vauxhall brands to its global strategy as reasons to keep the units in the GM fold. GM plans to slash costs at Opel and is looking to cut capacity in Europe by about 20%. The company announced plans to close a plant in Belgium by mid-2010 and cut more than 8,000 jobs across Europe. In order to complete the restructuring, GM is providing about $1.9 billion in loans to the units, and is requesting around $2 billion in additional government loan guarantees, primarily from the German government. At one point, GM had agreed to sell its Opel/Vauxhall brands to Canada-based auto parts maker Magna International
In early 2010, GM sold Saab Automobile to Dutch sports car maker Spyker Cars for about $75 million in cash and $326 million in preferred stock (which represents less than 1% of voting rights in Saab). The deal was finalized in February after previous deals - including an earlier bid by Swedish sports car maker Koenigsegg Automotive - fell through.
A deal to sell the HUMMER brand to privately held Sichuan Tengzhong Heavy Industrial Machinery, a Chinese company with no previous experience manufacturing passenger vehicles, collapsed in February 2010 when Tengzhong failed to gain approval from the Chinese government. A deal to sell the Saturn brand to Penske Automotive Group fell through in September 2009 when Penske was unable to find another manufacturer to produce the cars once the contract with GM ran out in 2011. GM is simply not investing in its Pontiac brand, and expects it to be phased out by the end of 2010.
GM's fortunes outside of North America are looking up. With the world's largest pool of potential drivers, China's automotive market is experiencing explosive growth and GM plans to spend $3 billion over the next couple of years in order to keep up with demand there. It also plans to double its production capacity and introduce new models, and has set up a financing venture with Chinese partner Shanghai Automotive Industry Corporation (SAIC). Other GM interests in China include Shanghai General Motors (a joint venture with SAIC) and FAW-GM Light Duty Commercial Vehicle (a JV with China FAW Group).
Late in 2009 GM agreed to sell half of its Indian operations and a 1% stake in Shanghai General Motors to SAIC (giving SAIC a 51% interest in the venture), as GM tried to raise capital to cover losses at its South Korean subsidiary GM Daewoo. GM needs the money, and wants to crack the Indian market. SAIC, the first Chinese car company to make a showing in the Indian market, has a better chance of gaining a foothold in that geographic area; it plans to invest as much as $650 million in the India push. Both GM and SAIC are eyeing other markets in Southeast Asia for growth.
After leading GM through a painful restructuring, CEO Rick Wagoner was forced to resign by the US government as a precondition for continued government aid. Frederick (Fritz) Henderson, the company's COO since 2006, took Wagoner's place. In eight months on the job, Henderson brought GM out of bankruptcy and oversaw attempts to sell the company's non-core brands, with little success.
In 2006 GM's finance arm, GMAC, sold a 78% equity stake in its commercial mortgage business to a private equity consortium including KKR, Five Mile Capital Partners, and Goldman Sachs Partners for about $9 billion. GM trimmed its stake in Suzuki from 20% to 3% about the same time, and it sold its 8% stake in Isuzu to Mitsubishi Corp., ITOCHU Corp., and Mizuho Corporate Bank for $300 million.
Also in 2006 GM sold a 51% stake in GMAC to a consortium of investors led by Cerberus Capital Management for $14 billion.
GM sold its Allison Transmission commercial and military business to The Carlyle Group and Onex Corp. for about $5.6 billion in 2007. GM retained an Allison plant in Baltimore to build transmissions used in the automaker's light trucks.
Health care costs were a GM pain point for years, with retiree health care arguably the biggest drag on GM profits. To cut costs, GM early in the decade offered to finance the early retirement of thousands of unionized GM and Delphi workers.
The company dodged a bullet in 2007 when the UAW, fighting for health care for retirees, ended a two-day strike - the first nationwide UAW strike against GM in more than 35 years. The two hammered out a deal creating a $50 billion independent health care trust (with GM ponying up most of the trust's funding), a move expected to stop health care-related red ink from piling up on the GM balance sheet.

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