That is right, we just bailed out yet another bank. The nation now owns GMAC.
Now I know you must be thinking, haven't we already bailed out GMAC once?
Why, yes we have already bailed them out before.
In fact, this is the third time American taxpayers have bailed out GMAC. Last year, Bush's bailout gave GMAC $5 billion. President Obama then bailed them out again in May with $7.5 billion. Today, President Obama is bailing them out again with $3.8 billion.
Okay, so the lists of major assets that the American people now own:
The additional aid for GMAC underscores both its struggles and its importance to the administration's efforts to revive the auto industry. GMAC, which already has taken $12.5 billion in direct federal aid along with other forms of government support, is the largest lender to General Motors and Chrysler dealerships and to their customers.
Treasury said that it will increase its stake in GMAC to 56 percent from 35 percent. The government also will hold about $14 billion in what amounts to loans that GMAC may eventually repay. The government plans to appoint four of the company's nine directors.
You must also be thinking that this is just another loan, we will eventually get paid back by GMAC, right?
Well, not exactly...
The government is investing $3.8 billion in GMAC, increasing to $16.3 billion the total direct aid that the company has taken from taxpayers. In exchange, Treasury received securities, including preferred shares, that require the company to make regular interest payments. Both GMAC and Treasury said they expect the aid will eventually be repaid.
The government also announced Wednesday that it will exchange $3 billion of these preferred shares for common shares of GMAC stock which do not pay interest and will not be repaid, though they can be sold for a profit if the company's share price increases.
What? We demand preferred shares of stock, so the bill will be repaid and then immediately turn around and exchange $3 billion to common stock ensuring that we will not be repaid.
So we just handed $3 billion taxpayers dollars to GMAC with no intent of recovering that money for the American people?
Heck of a job, Timmy and Barry!
Then Obama's Treasury Department has the nerve to say this:
"These actions fulfill Treasury's commitments made in May to GMAC in a manner which protects taxpayers to the greatest extent possible," Treasury said in a statement.
How in the world do these nitwits have the nerve to make this type of statement?
You just gave away $3 billion in tax dollars to GMAC and told them they do not have to repay it! How does that little move protect taxpayer?
By the way, you have got to love Obama's transparent government that once again dumps this on the people during a holiday when they are not paying attention!
Oh my goodness, my head is hurting again!