Tuesday, May 07, 2013

Just another government bailout

By Mustang Bobby

Remember how a lot of people said that bailing out the auto industry was a waste of money and that we should let Detroit go bankrupt?

Yeah, how’d that work out, anyway?

Today, the U.S. Department of the Treasury announced the next step in its plan to sell its approximately 241.7 million remaining shares of General Motors (GM) common stock with the initiation of a second pre-defined written trading plan.

“TARP’s emergency support to GM during the financial crisis was necessary to prevent the collapse of the American auto industry and save more than one million American jobs,” said Tim Massad, Treasury Assistant Secretary for Financial Stability. “Earlier this year, Treasury launched an effort to sell its remaining shares in GM common stock. We are pleased with the progress to date and will continue exiting this investment in accordance with our previously announced plan and timetable, and in a manner that maximizes returns for taxpayers.”

Treasury’s sale of its GM common stock is part of its continuing efforts to wind down the Troubled Asset Relief Program (TARP). To date, Treasury has already recovered nearly 94.6 percent ($396.70 billion) of the funds disbursed through TARP ($419.37 billion). Excluding the housing programs, Treasury disbursed $411.72 billion for all TARP investment programs and has now recovered $414.25 (including the proceeds from sales of all Treasury AIG shares).

In short, the government recovered almost all the money spent on TARP and actually made a profit. Plus it is selling the rest of its GM stock at a profit as well.

(Cross-posted at Bark Bark Woof Woof.)

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