The US Treasury flung open the doors for GM to take billions to stay afloat. Now, an economic advisor for the current administration with confidence that
"most, if not all" of the bailout money will be returned to the government. The official government estimates are substantially more grim, but the likely reason for such a low outlook is for higher return to be seen as a surplus as opposed to a deficit. The article correcly points out that the remaining balance the government spent on GM is held in a stake of ownership, not loans. This means that GM has covered its required loan payments as announced. The remaining value will return to the government whenever the government decides to sell its stake in GM, likely during the initial public offering expected later this year.
If this isn't compelling enough evidence that GM is on the right track, the US government has indicated that it may
lose as much as $1.9 billion as a result of the Chrysler bailout. Chrysler still owes $1.6 billion in loans despite entering and exiting bankruptcy before GM. The US government has a substantially smaller stake in Chrysler, presumably reflecting that the government has less confidence in its recovery.
Both articles are by Leftlane News. Discuss.
