Treasury Gets Ready to Lose Another $5.1 Billion on its GM Bailout

Jeff Roberson/AP file photo

The Treasury Department announced that it would begin another round of sales of General Motors stock, with the hope of getting rid of its remaining 17.7% stake in the company in the next 12 to 15 months. Unfortunately for US taxpayers, this means the Treasury is essentially accepting a loss of $17.51 per share.

The government bailed out GM in late 2009 for $49.5 billion to prevent the troubled automaker from filing for bankruptcy. Some arithmetic shows that the government purchased shares at about $49.56 a pop. Since late 2010, it’s been reducing its stake in the company from a high of 60.4% to 17.7% today, according to data from ProPublica. As of today, shares of GM were trading for $32.05.

So if the Treasury sold its estimated 241.7 million remaining shares today, it would take a loss of about $5.1 billion just on its remaining stake in the company. The government may have actually turned a profit from bailing out Wall Street. The auto industry? Not so much.

Read more at Quartz.

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
FROM OUR SPONSORS
JOIN THE DISCUSSION
Close [ x ] More from GovExec
 
 

Thank you for subscribing to newsletters from GovExec.com.
We think these reports might interest you:

  • Forecasting Cloud's Future

    Conversations with Federal, State, and Local Technology Leaders on Cloud-Driven Digital Transformation

    Download
  • The Big Data Campaign Trail

    With everyone so focused on security following recent breaches at federal, state and local government and education institutions, there has been little emphasis on the need for better operations. This report breaks down some of the biggest operational challenges in IT management and provides insight into how agencies and leaders can successfully solve some of the biggest lingering government IT issues.

    Download
  • Communicating Innovation in Federal Government

    Federal Government spending on ‘obsolete technology’ continues to increase. Supporting the twin pillars of improved digital service delivery for citizens on the one hand, and the increasingly optimized and flexible working practices for federal employees on the other, are neither easy nor inexpensive tasks. This whitepaper explores how federal agencies can leverage the value of existing agency technology assets while offering IT leaders the ability to implement the kind of employee productivity, citizen service improvements and security demanded by federal oversight.

    Download
  • IT Transformation Trends: Flash Storage as a Strategic IT Asset

    MIT Technology Review: Flash Storage As a Strategic IT Asset For the first time in decades, IT leaders now consider all-flash storage as a strategic IT asset. IT has become a new operating model that enables self-service with high performance, density and resiliency. It also offers the self-service agility of the public cloud combined with the security, performance, and cost-effectiveness of a private cloud. Download this MIT Technology Review paper to learn more about how all-flash storage is transforming the data center.

    Download
  • Ongoing Efforts in Veterans Health Care Modernization

    This report discusses the current state of veterans health care

    Download

When you download a report, your information may be shared with the underwriters of that document.