GMAC to receive another $3.8 billion in federal money

Discussion in 'The Refreshment Lounge' started by Blake Bowden, Jan 1, 2010.

  1. Blake Bowden

    Blake Bowden Administrator Staff Member

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    LeftLane reported earlier today that the U.S. federal government would likely announce the specifics later today of an additional bailout for GMAC, the funding arm for both GM and Chrysler. Now, the report has been released and it is confirms an additional $3.8 billion in federal aid will be paid to GMAC.

    The latest round of federal aid going to the financial institution GMAC brings the grand total to $16.3 billion, including the $12.5 billion it has already received since December 2008. Prior to today’s announcement, the federal government had a 35 percent stake in GMAC, and it will now have a 56 percent controlling interest in GMAC.

    Although GMAC is known as the financing arm for both GM and Chrysler, it also has approximately one third of its assets in mortgages. GMAC’s mortgage arm is worth approximately $3 billion on the books, and it is believed by many to be responsible for the financial instability of the company. Last quarter the mortgage business lost just shy of $600 million – while the automotive arm showed a gain of $164 million.

    The Obama administration’s decision to finally issue another round of federal aid is due to the fact that GMAC was the only major financial institution to fail the government stress tests. The additional funds were believed necessary in order for GMAC to operate efficiently.

    Source: http://www.leftlanenews.com/gmac-to-receive-another-3-8-billion-in-federal-money.html
     
  2. Blake Bowden

    Blake Bowden Administrator Staff Member

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    GM sucks. I purchased a Hummer H2...120 miles later transmission went out. Purchased a Hummer H3, at 24k miles it needed a new head. Purchased a GMC Acadia, 270 miles it's transmission had to be replaced. I now drive a Tundra and the wife has a benz...I'm done with GM trash. Never had a problem Ford though. They're pumping out some great products.
     

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