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Pressure is on

August 31, 2012
The Daily News

EDITOR:

Did Obama save GM?

Remember how Obama keeps telling us how he saved GM, and how our economy is getting better? It seems the car company he bought, is being saved by government employees, and they're using our tax money to buy new cars.

Did you know that 79 percent of GM's sales last month were government purchased?

GM's sales figures for last month were the best since 2008, up 16 percent for the month of June.

Yippee.

Well, wait just a minute. It seems that those rosy sales figures are due primarily to a 79 percent increase in fleet sales to the U.S. government in June.

That's right. Our tax dollars are being used to pump up GM's sales figures ahead of next month's quarterly report so that dear leader can point to Government Motors as a huge success.

The incestuous relationship between GM, the UAW and the regime has never been more glaringly apparent.

Yah know, I was union for 20 years and I never once, let them decide for me, who to vote for.

Today, talking to my union buddies, many of them have decided that it's OK to vote for the other guy. Shows they're paying attention to what's happening in their country and care about it.

I've said it before and I'll say it again. Is GM unsustainable without government subsidies and will it ultimately go bust again, taking billions of taxpayer dollars down with it?

We bailed out General Motors to the tune of $50 billion. Thirty billion dollars of this is effectively a loss, mostly sunk into fattening the United Auto Workers union-fierce Obama supporters-while the actual bondholders were shown the elevator shaft.

We the taxpayers are still stuck holding 500-plus million shares of GM stock. Which we need to sell at $53 per, and which debuted, post-bankruptcy at $33 per. And which is currently trading at just over $20 per, meaning we'll lose about $15 billion.

But it gets better. Despite the overwhelming negatives, Obama is heralding the tiny bright spot of positive June sales numbers, and the leftist press as proof the auto bailout was a "success."

Obama is now campaigning on the success of - the government buying cars from the government's car company. With our money.

Americanvision says, that's like you setting up lemonade stand for your kids. You buy them the lemons, sugar, cups and pitchers and then buy most of the lemonade yourself.

The pressure is on Government Motors to appear financially strong, as this may be the last earnings report before November elections and sets the stage for how "successful" GM is.

One of GM's past tricks to help fudge earnings numbers has been to stuff truck inventory channels. Old habits die hard at GM.

According to a Bloomberg report, "GM said inventory of its full-size pickups, which will be refreshed next year, climbed to 238,194 at the end of June, a 135 days' supply, up from 116 days at the end of May."

One hundred and thirty-five days' supply is huge; the accepted norm is a 60-day supply.

Their little trick here is, that GM records revenue when vehicles go into dealerships.

Rich Moore

Iron Mountain

 
 

 

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