President Obama To Take 69 Percent Ownership Of GM In Bankruptcy
With President Obama’s continued march towards socialism in the United States and continued government intervention in banks and American industry, General Motors looks like it’s going to be the next company to be nationalized by the ever intrusive government. My only question at this point is, what, you didn’t think with all the handouts from Barack Obama, that this wasn’t going to happen?
Whoever thought that a major company such as GM would be facing bankruptcy? In the later part of the 70′s when I was driving classic muscle cars such as the 69 Camaro and the 69 Firebird, GM was the leading car maker in the world and now its stock price is $1.15 when it was over $93 in April of 2000.
The possible bankruptcy now facing GM is being blamed by the media on GM bondholders being unwilling to take a “deal” offer up by the Obama administration giving them approximately 4 cents per dollar they are owed which they soundly rejected. What stories such as this one about the GM bankruptcy fail to mention is that the President is violating bankruptcy law by offering bondholders (read that, “financiers of the company”) such a deal. Granted, everyone loses is a bankruptcy, but there is law that must be followed mandating how a deal of this magnitude is to be handled.
Bondholders are owed $27.2 billion, or 43% of GM’s debt because they financed the company. In other words the money they paid to buy GM bonds allowed the company to run, pensions and salaries to be paid, parts to be purchased and other business activities to be paid for. The Obama administration was then only offering these bondholders a measly 10% of the mostly worthless company stock. Such a deal. The most bizarre thing about the deal being brokered by Obama’s henchmen is that the government may now take as much as 69% ownership in the company when they are only owed 27% of the outstanding debt.
How much worse will it get before Americans start to wake up and figure out what’s going on? Maybe it’s time to buy some gold bullion, bury it in the back yard so the feds can’t find it and stock up the bunker.
Obama ASU Speech – Building A Stronger Foundation?
President Barack Obama gave the commencement speech at Arizona State University yesterday and although his remarks were encouraging and pointed ASU graduates away from greed and towards what they can do to make the world, and our country, a better place, a bit of hypocrisy reared its ugly head during the talk. Unfortunately, hypocrisy is what you end up with most of the time when you’re the POTUS and you constantly seek to manipulate instead of lead.
Here are President Obama’s remarks in question:
And as a nation, we’ll need a fundamental change of perspective and attitude. It is clear that we need to build a new foundation – a stronger foundation – for our economy and our prosperity, rethinking how we educate our children, and care for our sick, and treat our environment.
If we need to build a new foundation for our economy as the President states, then why would you start out your tenure as the big chief by spending, lending or committing $12.8 trillion, that we don’t have, to bailout crooks, cheats, and institutions that may possibly collapse or go bankrupt anyway?
As I mentioned in my last post, in addition to the $12.8 trillion the POTUS signed over to crooks and failed business models, he has also proposed the largest budget in history to run the ever expanding government with the largest deficit in history to go along with it.
This isn’t a formula for prosperity and opportunity, it’s a formula for utter economic disaster. Printing money to cover the gargantuan expenditures the President is racking up, is a plan fraught with doom that can’t be undone until collapse ensues.
I just have one question for the President – How does spending that kind of money, that most assuredly can never be paid back, lay a stronger foundation for for our economy and prosperity?
It would be nice to have something other that the usual evading the question type answer given at one of his press conferences.
President Obama Proposes Largest Budget Deficit In History
President Barack Obama just last week proposed the largest federal budget in history with the largest deficit in history, 4.5 times that of George W. Bush’s last budget deficit and then in announcing his gargantuan monstrosity, Mr Obama made this statement:
“…one of the pillars of this foundation is fiscal responsibility. We can no longer afford to spend as if deficits don’t matter and waste is not our problem. We can no longer afford to leave the hard choices for the next budget, the next administration — or the next generation.”
What!?! I don’t even know how to react to such inane words (Please go read them, you won’t believe it). Are we living in an alternate universe where the president of the United States can do one thing and then make a statement as if what he just did is completely different than what is actually taking place? Apparently we are. If you are maxed out on all your credit cards, have 2 car payments and owe everyone you know money, it’s probably not a smart thing to get a home equity loan so you can take that cruise to Alaska. You would want to show some financial restraint, unlike the federal government is capable of doing.
What the President should have said to match his actions is, “We can no longer afford to spend as if deficits don’t matter, but I’m going to do it anyway because I won the election and I’m the frickin’ President, so get use to it.”
It is clear from the President’s actions that deficits don’t matter to him when the projected deficit for his budget now stands at $1.8 trillion. But beyond that, what’s really going on here is the current administration simply trying to manipulate the public into believing the economy isn’t as bad as it really is and the President isn’t spending more money than we can possibly supply him through the current tax structure. If you think Mr Obama can spend this kind of money (while blaming the past administration) and still keep his campaign promise of a tax cut for 95% of Americans, you should take a basic course in economics. Simple math tells me you can’t get $1.8 trillion extra that you don’t have from only 5% of the US population, you need a little bit bigger base.
The most disturbing part if this whole thing is that The President is flat out lying to the American public when he tells us that we need to spend this kind of money to fund the government. We don’t. The President is doing more that funding the government, he’s growing it to unprecedented levels. At some point, if we continue to spend money like this, there will most surely come a day of reckoning and we will simply run out of money. And then what’s the US government going to do?
Maybe it’s time to buy gold coins and gold bullion before this train wreck goes off the cliff it’s heading for.