GM is back for more money.

[Ollie]

ok, did you read the article?
It states in the first line .................

"GMAC, the financial lifeline for General Motors Co., Chrysler Group LLC and their dealer networks, is asking the U.S. Treasury for more federal aid beyond the $12.5 billion it’s already received"

So I would say there is a "little" bit of connection there.

 

[maluchm]

ok, did you read the article?
It states in the first line .................

"GMAC, the financial lifeline for General Motors Co., Chrysler Group LLC and their dealer networks, is asking the U.S. Treasury for more federal aid beyond the $12.5 billion it’s already received"

So I would say there is a "little" bit of connection there.

Yes because they are the main financial arm for GM and Chrysler dealerships. When GM started having troubles years back they sold off GMAC. Just like they did with portions of Delphi. If they would've been renamed at that point I don't think we'd be debating this that much. Granted ,GMAC is another financial institution asking for money, but to call them GM is not correct IMO.

 

[Ollie]

If they were just a general banking institution you would be correct, however, they are the primary lending arm of GM.
They may have been sold but GM still depends heavily on them.
If GMAC goes under, GM follows.
If GM didn't build the motors they would still need to to make cars, no motors, no cars.
Gm needs GMAC, no GMAC, no GM.
GMAC got their management structure from GM.
GM gets most of their funding (for the purchase of cars) frm GMAC.
If GMAC goes under it will take GM with it.
THe primary reason GMAC is in trouble is because of GM. If they didn't have GM they wouldn't be in trouble. Of cource they wouldn't be in buisness either.
You can't have one without the other.

My point was, GM is so badly run that they need GMAC to get the money so they can continue to get loans from GMAC. It is the same as giving GM the money, you are just going thru a second party and that gives the politicians the right to say it's not "technically" giving money to GM, but they are giving the money to GMAC to give to GM.

 

[milehighassassin]

GM sold GMAC. They have nothing to do with them anymore.

 

[FINISHER]

So, even if GMAC isn't directly owned by GM, do you still support them(GMAC) receiving your tax payer money to support failing C.E.O.s. Just a question for beels & Milehigh.

I am a contractor and I sure haven't seen that these bailouts have helped the industries at all. I am not getting any money to prop up my small co. Like what was said before, If I make a bad business decision I eat it and my family suffers. Our govt needs to just back off the privet sector. Let the chips fall where they may.

 

[snowdog484]

I agree that they(gm and chrysler)or any other bailout can go down in flames. People just keep on supporting it though. I'm doing my best to try and not support these companies. Its time to make a stand people.

 

[B C]

GM gets most of their funding (for the purchase of cars) frm GMAC.
If GMAC goes under it will take GM with it.
THe primary reason GMAC is in trouble is because of GM. If they didn't have GM they wouldn't be in trouble. Of cource they wouldn't be in buisness either.
You can't have one without the other.

My point was, GM is so badly run that they need GMAC to get the money so they can continue to get loans from GMAC. It is the same as giving GM the money, you are just going thru a second party and that gives the politicians the right to say it's not "technically" giving money to GM, but they are giving the money to GMAC to give to GM.

Oh boy...

GMAC is actually is trouble because of their home lending unit, you know the whole sub-prime lending mess. I know this because I read it in the article this thead is about, among other articles.

And FFS, GMAC does not loan or give money to GM to buy cars or operate. It loans money to GM/Chrysler dealers to buy/floor cars. And it loans money to GM customers to buy cars. Now, read back to Ollie North and try to keep up. One last time for the slow peeps...GMAC is NOT GM. GMAC does not give money to GM.

Now, that being said...would GM be in dire straits w/o GMAC? Absolutely.

 

[Ollie]

Oh boy...
Now, that being said...would GM be in dire straits w/o GMAC? Absolutely.

ok, once more for the ones who can't read between the lines.
Without GMAC, GM goes down in flames.
So when bo and company give GMAC the money, GM will profit by being able to get money. GM isn't getting money directly from the feds in the form of a loan, the money is going to GMAC and will THEN be given to GM to keep GM afloat.
If GMAC doesn't get the money GM is DONE.

Urgo, GM NEEDS GMAC TO GET THE MONEY SO GM CAN KEEP OPERATING.
Therefor, GM IS GETTING ANOTHER LOAN.

 

[B C]

The money the govt. loans GMAC is not given to GM.
Will GM benefit from GMAC staying afloat, yes. But GMAC will use that money to keep their own heads above water, NOT GIVE IT TO GM. GM is not getting money from GMAC that's all I'm trying to say here. FAWK my head hurts now.

 

[Ollie]

The money the govt. loans GMAC is not given to GM.
Will GM benefit from GMAC staying afloat, yes. But GMAC will use that money to keep their own heads above water, NOT GIVE IT TO GM. GM is not getting money from GMAC that's all I'm trying to say here. FAWK my head hurts now.

It should hurt.
You don't understand what I am saying here.
GMAC is the financial LIFELINE of GM.
By GMAC getting money, it will allow them to continue to support GM.
If GMAC doesn't get the money, GM and GMAC are done.

It's just like tire.
GM doesn't make the tires they put on their vehicles.
GM doens't own the company that they get their tires from
However, GM does benifit from the tiremaker being in buisness, it allows GM to sell cars. Without the tiremaker GM can't sell cars.

Same with GMAC.
Gm doesn't own them (anymore).
But GM can't survive without em.
By GMAC getting money, GM stays in buisness.
Simple as that.
It's the same as giving GM the money.

 

[BigJake]

If you want a vehicle, buy a Ford. Never thought I would say that because I like Dodge, but..............

According to reports Ford has a 1 billion profit.

http://www.msnbc.msn.com/id/33583171/ns/business-autos

 

[B C]

By GMAC getting money, GM stays in buisness.
Simple as that.
It's the same as giving GM the money.

Oh, now it's the same as giving them money. Thank you, I've made my point.

 

[Ollie]

Oh, now it's the same as giving them money. Thank you, I've made my point.

What point would that be?

 

[B C]

Same point others have pointed out. GMAC and GM are two separate entities. The money the Feds loan/give to GMAC does not go to GM to keep them afloat. That's it that's all.

 

[Ollie]

Same point others have pointed out. GMAC and GM are two separate entities. The money the Feds loan/give to GMAC does not go to GM to keep them afloat. That's it that's all.

Ok, I give up.
Your right.
There is absolutely no relationship between the two.
If GMAC goes down GM will be fine.
GMAC isn't the financial arm of GM as stated in the article.
GMAC isn't the primary lender to GM.
GMAC has no relationship whatsoever with GM.
Those 2 companies have absolutley nothing to do with each other.


http://www.marketwatch.com/story/gm-to-sell-gmac-stake-to-cerberus-led-group

"This agreement is another important milestone in the turnaround of General Motors," said Chief Executive Rick Wagoner. "It creates a stronger GMAC, while preserving the mutually beneficial relationship between GM and GMAC." He said the deal was not a sell-off but a partnership. "I think this is just what the doctor ordered as a matter of fact," Wagoner said in a conference call.


and


"It's not a sale of GMAC by GM and saying, 'Nice knowing you,' " said GMAC Chairman Eric Feldstein. "They retain a 49% stake [and] there's a 10-year operating agreement" and stipulations that ensure GMAC and GM continue to do business.


Yep, no relationship whatsoever.
You were right.
Ya got me.

 

[Wolfrun]

Good, ollie

 

[B C]

Ok, I give up.
Your right.
1. There is absolutely no relationship between the two.
2. If GMAC goes down GM will be fine.
3. GMAC isn't the financial arm of GM as stated in the article.
4. GMAC isn't the primary lender to GM.
5. GMAC has no relationship whatsoever with GM.
6. Those 2 companies have absolutley nothing to do with each other.

1. I never said this. I'm a dealer and quite aware of what the relationship is.
2. Once again, here's my post: "Now, that being said...would GM be in dire straits w/o GMAC? Absolutely."
3. Never said they weren't
4. GMAC is NOT the primary lender to GM for operating funds. They are the primary lender for floor plans and consumer financing for GM vehicles.
5. Once again, never said that.
6. And again, I'm very aware of the relationship.

If I didn't know any better, the way you spin things; I'd say you worked for the liberal media!

Am I happy about the situation GM & GMAC are in? NO. Am I happy the govt. bailed them out? NO. I'm just as pissed off at the deal as every other taxpayer. But, facts is facts and I just thought I'd point a few out for clarification. Let is snow!!!!

 

[Ollie]

ok, your not getting what I am talking about, so let me try something different here.

Ok, lets say you own a buisness building houses. within that buisness is a sub-buisness that sells the lumber to build said houses. Now your company isn't doing too good and you need cash.
What do you do, the bank has already loaned you more money than they wanted to and you know you can't get more from the bank.

But what you can do is sell the majority of the sub-buisness to someone and still have 49% of the company. Now you have money to help run your company since you sold 51% of the sub-company.

Well, guess what. Your a lousy buisnessman and your company is still going under.
Well your sub-company isn't doing so hot either. The primary on that company did some bad deals and is in financial trouble also.

Hey, your sub-company hasn't over extended itself, they could get another bank loan.
So that is what you do. The sub-company gets the loan.
Now you can't just take the money, that would be illegal.
However, you can get a line of credit with the company to get more lumber so you can continue to try and get your primary company going again. Since now the sub-company is on firm ground you can use it.

The sub-company isn't "owned" by you, you just use it. Sort of like a shell game. You still get a major lift by getting to put off the bills while operating on the banks money.

Same with GMAC and GM.
GM doesn't own GMAC, but you can bet your bottom dollar they will profit from GMAC getting the money.
Does that clear it up?

 

[Beels]

You were right BC.

Nailing jello to a tree... Some people are just plain clueless.

 

[Gainster]

http://www.realclearmarkets.com/articles/2009/11/03/gmacs_lifeline_is_the_economys_noose_97484.html

Though economic logic tells us that GMAC should never have received even one dollar of federal largesse, if the planned handout of an additional $5.6 billion is approved by Treasury, GMAC will be the unworthy recipient of $17 billion of taxpayer funds. The latest GMAC lifeline is being defended as a way to revive carmakers GM and Chrysler, which politicians see as important to the health of the U.S. economy.

The problems with this thinking are many, however. Put simply, everything Washington gives out must somehow be paid for, and in this case the political class will seek to stimulate two companies left for dead by private investors. But in order to do so it must by definition depress the commercial outlook for successful companies that don't require government funds to survive.