I have gone a whole day without mentioning Goldman Sachs (bugger I just mentioned it) and its relationship to the movie the “Sting” – Paul Newman/Robert Redford how could one forget.
Anyway a little bit of spin instead of sting to finish the day. We have all seen the headlines this week that General Motors is going to pay back its government debt 5 years ahead of schedule – pats on back all round.
Delving a little deeper into the story, blogger Kid Dynamite says what GM forgot to mention was that they (the US government) are still holding 61% of GM’s equity. That’s right GM borrowed $52bln off the US government and $9.5bln from the Canadian govt – promptly declared bankruptcy, wiping out most of the debt save for $6.7bln (US govt) and $1.4bln (Canada) and converting the rest to equity.
Yes they have paid back the $6.7bln and the $1.4bln but what about the rest……….supposedly a public stock offering sometime in the future if the market holds up.
