How GM IPO Proves the Tea Party Wrong

"General Motors' IPO was a hit on the New York Stock Exchange. Shares of the industrial giant, which emerged from bankruptcy after a taxpayer-funded bailout, jumped $2.15 to $35.15, about 6.5 percent above its initial offering price of $33. GM executives rang the opening bell on the NYSE."

http://www.nytimes.com/aponline/2010/11 ... f=aponline

If we thought the US taxpayer was on the hook for billions before....now we are on the hook for even more billions. I'm betting Obama would chase bad money with good borrowed dollars to keep GM afloat if the stock tanks and losses mount. Anyone else?

Yeah, it's terrible... It's already up 6.5% in the first 5 hours of trading... The horror---The horror.....

"You know, the stock market is sort of like a tracking poll in politics" Barack Obama, March 2009

LadyJazzer wrote: Yeah, it's terrible... It's already up 6.5% in the first 5 hours of trading... The horror---The horror.....

So those investors will dump and run. Good for them, at least some Wall Street fat cats will make a killing before it tanks. This is how Obama repays his investment buddies. This IPO stinks, only the big banks got in on it.

"Investment buddies"? What rock have you been living under? The financial industry is so P.O.'d at him for the FinReg legislation to curb their insanity that they will spend millions next time to get rid of him, and spend millions to lobbyists over the next 2 years to try to dial back the FinReg changes....

Every time I think you can't possibly be that out of touch, you prove me wrong.

conifermtman wrote:

LadyJazzer wrote: Yeah, it's terrible... It's already up 6.5% in the first 5 hours of trading... The horror---The horror.....

So those investors will dump and run. Good for them, at least some Wall Street fat cats will make a killing before it tanks. This is how Obama repays his investment buddies. This IPO stinks, only the big banks got in on it.

That's how it usually works on risky stocks....the big banks get their discounted shares, hype the stock, sell it to the unwitting public at a high price on a run up, and then it collapses back to it's real price.

I always enjoy the comments from the self-professed "experts". IPOs on the NYSE are always underwritten by banks and financial institutions. Those entities receive a 7% discount for taking on the entire risk of the IPO. Those institutions then allocate the shares to their clients and brokerage firms for sale to the general public. This instance is no different than any other large IPO.

Also, according to the Center for Automotive Research,
“The CAR study says the federal government would have spent $28.6 billion more than it did on unemployment benefits, Medicare, Social Security and other programs had the automakers liquidated. So the entire rescue will pay for itself if the government can generate $38 billion from selling its shares.” But perhaps the most chilling details in the story were the report’s conclusions that liquidation of the two auto companies would have meant the loss of 1.4 million jobs and $121 billion in personal income."

Something the Dog Said wrote: But perhaps the most chilling details in the story were the report’s conclusions that liquidation of the two auto companies would have meant the loss of 1.4 million jobs and $121 billion in personal income."

"Let them eat cake".... (Rightie dogma... Repeat as needed.) :bash

The US Tax Payer lost 9 billion on this boondoggle for Wall Street.

http://www.reuters.com/article/idUSN1827687520101118

Bloom said GM has done the right thing and pricing of $33 per share is a "fair deal" even though the partial sale represents a loss of roughly $9 billion on taxpayers' original investment.

If that proves the Tea Party wrong, I just want to know what color is the sky on the planet you are on?