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, because it remains billions of dollars short of a capital reserve requirement all bank holding companies must meet.

The request, which is subject to ongoing negotiations, comes as GMAC is caught in a financial game of chicken with Chrysler Financial that could drive some large Chrysler, Jeep and Dodge dealers out of business or force them to sell their operations.

Chrysler Financial, which Treasury has demanded go out of business by the end of 2011, is asserting its first-lien rights on loans to Chrysler dealers. At the same time GMAC, due to its capital shortfall, has asked those same dealers to pay additional collateral on the vehicles they order from Chrysler Group. Many of those dealers borrowed $10 million or more to expand their showrooms, and can’t sell the property for anywhere near what they owe Chrysler Financial.

It’s unclear whether additional taxpayer aid to GMAC would alleviate that problem.

The government already owns 35% of GMAC as a result of the government-financed bankruptcy restructuring of General Motors. Additional government assistance could give taxpayers a majority stake and raise questions about the Obama administration’s statements that it doesn’t want to run auto companies. GMAC, which the Obama auto task force chose as the primary source of financing for both Chrysler and GM, must be healthy if either manufacturer is to sell enough cars to stem their declining market share and repay their own government loans.

For the rest of the story:

http://www.freep.com/article/20091028/BUSINESS01/91028022/1322/GMAC-may-get-3rd-helping-of-aid

Face Forward Comments:

You mean that cracker jack team of Union bosses and government appointed overseers have not been able to crack the profitability code yet?  Whoops, now that I think about it, has any government appointed overseer or any union boss ever cracked any profitability code anywhere?

Of course we are going to give the money to GM.  We gave money to fund a (foreign) car company that Al Gore invested in, so why wouldn’t we turn more money over to GM and the unions.

Everything about the GM deal is so crooked and full political payoffs it sickens me. Besides the American Tax Payer, stock holders, and former dealerships as the obvious looser in the deal, think about the people that have seen the value of their car drop because they were unlucky enough to have bought a GM….Imagine all of Hummer owners when they found out that the brand was going to China.  And my favorite, imagine all of those people that bought a Saturn.  The deal was done and Penske was going to buy the brand.  Then suddenly, after Saturn (GM) was able to move all of their old dead stock with Cash for Clunkers, the Penske deal is off.  Sorry if you already owned a Saturn.  How could you have known it was going so bad for GM.  But for those of you that bought after the car bailout, well, you already knew the government was involved so you really should have seen that one coming.

I know it is much to early to expect any kind of improvement given the economy, however do you really ever expect anything different from this company?  Isn’t this the way it will always be?  My answer; I expect no changes and for GM to be on the public dole for the rest of it’s existence.  It was already a bureaucratic nightmare and will be even more so now that no one there will be able to make a decision without presidential approval.  We all know his decision making process, dithering.

As for me, I am buying a Ford F-250 and hoping that GM and the rest of the politicans that bought them, go away

Wednesday, October 21, 2009

America Now Over 6 Million Jobs Shy of Administration’s Projections.  These are the same people that want to run helath care, control your salary, and tax you for your carbon usage?  You would have to be nuts to trust this administration.

The table below compares the White House’s February 2009 projection of the number of jobs that would be created by the 2009 stimulus law (through the end of 2010) with the actual change in state payroll employment through September 2009 (the latest figures available).  According to the data, 49 States and the District of Columbia have lost jobs since stimulus was enacted.  Only North Dakota has seen net job creation following the February 2009 stimulus.  While President Obama claimed the result of his stimulus bill would be the creation of 3.5 million jobs, the Nation has already lost a total of 2.7 million – a difference of 6.2 million jobs.  To see how stimulus has failed your state, see the table below.

WASHINGTON — Americans have historically swung between anger at big business and anger at Washington. This year their rage has targeted business and government with equal fury.

Public frustration over Wall Street failures that led to the financial crisis was typified by the uproar over bonus payments to American International Group Inc. executives. Those feelings haven’t dissipated, political strategists say. At the same time, Americans are equally upset at what they call overreaching by Congress and federal bureaucrats, with protesters taking to the streets to decry “socialism” and a “government takeover” of the economy.

Policy makers face a quandary. With voters simultaneously recoiling at laissez-faire policies and a big-government approach neither party in Washington seems capable of corralling an angry public.

“I think this is a very populist moment,” said Vin Weber, a former Minnesota congressman and now a top Republican strategist. “People held onto their distrust of big business and Wall Street, but what has happened is their distrust of big government has come back as well.”

Last year when Barack Obama won the presidency and Democrats swept to big congressional majorities, commentators heralded the dawn of a “new New Deal.” Time magazine put Mr. Obama on its cover sporting a cigarette-holder in a pose reminiscent of Franklin Roosevelt. Democrats sought support for an ambitious agenda that included a stimulus package, an overhaul of the health-care system and a bill to address climate change.

 Along the way, they have encountered an angry distrust of government, and politicians of all stripes, that is palpable in tea-party groups forming around the country.

“I have had I don’t know how many politicians ask, ‘Can I speak at your tea party?’” said Catherina Wojtowicz, coordinator of the Chicago Tea Party group. Her response: “Honestly, it’s your turn now to shut up, sit down and listen.

For the rest of this article:

http://online.wsj.com/article/SB125539072998381441.html?mod=WSJ_hpp_MIDDLENexttoWhatsNewsSecond

You will thank me for this one!